There has been a lot of media attention on this subject so let me differentiate between the two.

While it is true that it is more difficult today to obtain financing  those with excellent credit and verifiable income should not have any issues.  In this market place excellent credit is defined as credit scores of 700 or higher.  Just a few short years ago this threshold was 680 and  in some cases 660.

For those with credit scores below 700 you will find slightly higher interest rates, and possibly larger down payment requirements.  As an example, the same loan request with a 660 score could offer a .25% higher rate than someone with a 720.  Due to the current perception of risk at the lower credit levels an even larger risk premium is applied and thus the rate differential can be even higher.

For those that were used to no income verification loans you will find that the product is no longer readily available. If you are able to verify your income you will notice that regardless of your credit score that there is a maximum total debt to income ratio threshold applied at 45%.

So are mortgages more difficult to obtain yes, but the degree of difficulty depends on your credit score and the lenders ability to verify your income.

Questions about your specific financial scenario?

Tony Pigatti

Archer Bank

tpigatti@archerbank.com

708-237-4049

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