Myth: The financing has all dried up, nobody can qualify to buy a house
I don't believe it and neither should you. Okay, Clearly we are grading on a curve. Is it harder to get a buyer financed now than it was a couple years ago? Sure it is, and thankfully so.
Fannie Mae and Freddie Mac have tightened their guidelines and lowered their maximum Loan to Value (LTV) and Combined Loan to Value (CLTV) ratios. That's not a bad thing. Now to buy a house you actually have to prove you can pay for it, be creditworthy and put some money down. They claim that their automated underwriting algorithms never changed either way, but I don't know anybody who's buying that.
And then there is FHA. The one and only thing the legislators got right throughout this whole mess was FHA. FHA has always been a great option with regard to underwriting. More lenient credit requirements and down payments are the tip of the iceberg. Now that the maximum loan amounts are in line with the market, buyers CAN buy homes.
Of course there is the constant battle that is the refinance. Being objective, the programs are still there, it is the home values that have gone away.
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