Why have mortgage lenders tightened their guidelines so much? Can I still buy a home with zero or no money down? Will I be able to refinance with the tougher mortgage lending guidelines? I am not able to refinance and my ARM is about to expire what should I do?
These are some very common questions being asked right now in 2008 by consumers everywhere. With the record number of foreclosures that have hit our nation and so many mortgage loans going bad, the mortgage industry was in need of a serious overhaul or makeover. Therefore, lenders have been forced to tighten up their lending guidelines to make sure that they are producing loans of better quality which is not only better for them, but better for the consumer as well. While, lending guidelines and underwriting guidelines have definitely tightened up quite a bit, there are still numerous programs available for consumers to buy home with little or no money down. If you have questions about what you may or may not qualify for now in this new mortgage market, consult a mortgage professional quickly.
Many consumers and lenders alike are finding that the "tried and true" financing programs offered by Fannie Mae and Freddie Mac, FHA, and the Veterans Administration are proving to be the most reliable sources of hime financing. It is now very important to find a mortgage representative with a sound knowledge of financing for these mortgage loan products.
Some borrowers that previously could be approved are now being required to put more money down or go with a less than desirealble loan program. Lenders have tightened restrictions on not only credit scoring, but also on income, time on the job, and reserve requirments. In years past a home buyer may have been able to get a zero down payment home loan at very favorable rates with a credit score of 620. Now, that same borrower may be required to have a 10% or 15% down payment on the property.
It isn't all bleak. borowers with good credit and a decent job history may stil be eligible for a variety of zero down home loans. What may be the single most important factor in getting a home financed in this market is finding a Mortgage and Real Estate professional that have been referred to you and have plenty of experience in dealing with these type of buyers.