Everyone in the free world with a radio, TV, newspaper, neighbor, or internet connection knows that foreclosures are at all time high across this great land of ours.  What few people understand is what affecting this has on us a community.  Sure everyone knows that banks and mortgage lenders have lost billions and somehow we as tax payers are going to be involved in helping to clean up this mess, but what about our future? 

Fannie Mae (the Federal National Mortgage Association), the largest purchaser of mortgage loans in the US has just released a memo about its revised automated underwriting system, DU 7.0.

Of course there are several areas they have tightened their lending standards, including setting a minimum credit score of 580 and increasing the minimum credit score for some of the specialized programs, such as the Fannie My Community Program. 

There is one specific area that I found concerning, they have increased their minimum time out of foreclosure from 2 years to 5 YEARS!  So if a family is forced into foreclosure in 2008 that means that they can not qualify for a loan from Fannie Mae until 2013.  Since Freddie Mac typically follows Fannie Mae's lead, we will probably see Freddie release similar guidelines.

All of these families who are loosing their homes are going to need some place to live.  Apartment companies across the nation are beginning to get flooded with applications and have also begun to increase their qualifying criteria as well.

Foreclosing on a home today, unlike a few years ago, means that you most likely will not be able to buy another home for at least 5 years.  Therefore you are unwittingly committing to be a RENTER for at least the next 5 years!

Becoming a Landlord is looking more attractive everyday!