Good clients of mine, with excellent credit, are hunting through various lenders to get a line of credit that would have been easy to arrange a year ago.
Getting a mortgage today is not what it used to be. Not long ago, anyone could get a loan. Now it's a challenge.
Mortgage insurers, whose backing is required for borrowers who can't afford the traditional 20 percent down payment on a home, have already flagged nearly a quarter of the nation's ZIP codes where they refuse to insure some home loans. Our entire state is blackballed on some insurers' lists because of high foreclosure rates and price declines, even though some areas are doing well.
Banks that have lost billions because of bad choices during the housing boom are now reverting to strict lending standards not seen in nearly 20 years, according to industry data and interviews with lenders.
For new home buyers and those seeking to refinance, it can mean higher down payments and a higher bar for credit scores, among other requirements. We thought that the interest rate cuts by the Fed would make getting a home loan and refinancing easier,
but this recent tightening of loan requirements threatens to dampen sellers' prospects for the spring home-buying season.
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