MORTGAGE CHANGES IN A VOLATILE MARKET
If there is one thing that 2020 has taught us, it's that things can change in an instant. Coronavirus came along and changed history globally. The human race has had to adapt to lifestyle changes such as homeschooling our kids while working vurtually at home as well as limiting trips to the grocery to help eliminate the spread of the deadly virus. Many have been laid off from work. Some temporarily while others won't have a job to go back to after stay home orders are lifted. What does all of this mean in the world of mortgages and real estate? While all the experts are telling us we have nothing to worry about in the real estate world, the reality is that mortgage lenders are feeling the heat. A lot of Economist are predicting that the housing market will be the factor to keep things afloat through this crisis, however, that doesn't mean that investors don't see huge risks, which is in turn changing standards all across the lending world.
Every day interest rates are changing and the standards at which lenders use to determine a buyer's credit worthiness are changing as well. In the last few weeks we have seen some lenders change there credit standards for FHA, VA and other federally funded mortgages and just recently in this last week, Chase anounced that they will be raising their minimum FICO score requirement to 700 and they will not do mortgages with less than 20% down on new prucahse mortgages (other than their in house dreamaker mortgages).1 This was a huge blow to buyers everywhere who have come to rely on the wonderful mortgage programs that in some instances require as little as zero down on a mortgage. As you can imagine, this left buyers scrambling who just 2 weeks ago qualified for a mortage that now may not. The good news? Not every lender is taking these drastic measures. The best thing you can do if you have recently been told that such changes have made it so you no longer qaulify for mortgage is reach out to another lender. I recommend always trying your local mortgage lenders first. Whether that be your local bank or credit union that you bank with regulary, or a lender that your trusted real estate agent recommends. We as agents have a lot of relationships with local lenders and since we are usually in communication with these lenders on a regular basis throughout our work week, we can usually help guide you to reach out to a great lender that can still find a way to help you obtain a mortgage to buy your home. 1) https://www.housingwire.com/articles/chase-now-requires-700-fico-score-20-down-payment-to-buy-a-home/