Most people need mortgages in order to acquire a home, but in this day and age, a mortgage is not something easy to come across.
Homebuyers in this day and age find themselves in quite the unfortunate predicament. Rents and home prices are on the rise, eating up more of people’s paychecks. But as everyone will tell you, buying a home is better than simply throwing money at the endless void that is rent. But you have to get a mortgage, and if you haven’t heard, they are a rather difficult thing to come across.
In 2007, an unsustainable 8.1 million new mortgages were issued which then plummeted to 5.7 million in 2010, during the deepest depths of the–preventable–house market crash. Lenders got burned. And in order to prevent this from happening again, lenders got serious.
MORE MORTGAGE REGULATIONS
The greediness of Wall Street and immoral are to thank for these tighter regulations. After the housing bubble burst in 2008, the federal government had to put in a few rules and regulations to make sure that faulty loans did not crash the world market again. According to one, it takes twice as much to get a mortgage as it did even five years ago.
INTEREST RATES ARE TOO LOW
Too low, that is, for lenders. Interest means profit for lenders and with lower and lower interest rates, the lenders get a lower cut of what they received ten years ago. Their ability to make money continues to be limited by low-interest rates.
BUYERS NEED AMAZING CREDIT
Lenders used to give out a loan to just about anyone. It may not come as a surprise, then, when these mortgages started failing and the crash. Lenders now officially check the applicant’s credit score to determine what they qualify for, if they qualify at all.
HOW CAN BUYERS INCREASE THEIR CHANCES OF A MORTGAGE?
- Increase your credit score by paying off your debts.
- Know what you can afford.
- Make the lender’s job as easy as possible by providing all the necessary paperwork the first time.
I serve the Bay Area and the entire state of California and Texas with quality, suitable, home loans! To properly sell a home, contact a dedicated home loan specialist like me, Andraya Coulter.