Is Getting a Home Mortgage Still Too Difficult?

Is Getting a Home Mortgage Still Too Difficult?

Potential homebuyers are always cautioned to be aware of mortgage lending standards and the difficulty they might face when trying to obtain a mortgage. Credit availability is expanding, making it easier to get a mortgage now than it was a year ago. The market is still tight however, and homebuyers should be prepared for the document requirements that will inevitablly be asked of you.

Mortgage lending companies have high standards so it is important to make sure you and anyone else who will be included on the mortgage have their credit in check. The mortgage market is strict because lenders do not want to be put in a situation where they are forced to repurchase loans that are not paid on.

What Has Happened to the Number of Mortgages?

Due to the strict nature and requirements of the lending companies, the number of mortgages given out has significantly dropped. A report by the Housing Financial Policy Center at the Urban Institute showed that about 6.3 million fewer mortgages were given out between 2009 and 2017. The reasons behind this statistic are strict regulations and policies. 

Mortgage companies rely on calculations to determine if a home buyer will become delinquent on their payment. They will not give you a loan if you are too much of a risk for them. Credit history has a huge impact on this decision since lenders can see how often you pay back your debts. The history they receive is extensive. This view into your financial past causes lenders to take less risk when lending to you for your mortgage.

The Effect on the Economy

After the housing market adjustment of 2008, mortgage lenders became stricter in their lending standards and documentation requirements. Stay on top of your credit, speak to your accountant and make sure everyone applying for the loan is in a financial position to be approved for a loan. 

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