Are today's guidelines tighter?

There are some who would argue that today's mortgage guidelines are too tight to allow the average person to buy a home.  Are they?  When compared to the guidelines of 2006, one could argue that to be the case, while others would use the rebuttal that the guidelines of 2006 were too loose.  Either way, there’s no denying that houses are selling.  From time to time, I like to pass on this statistic and the slide below shows that, in fact, homes are selling and at an average of 12,466 per day across the country, according to the National Association of Realtors (NAR).  And of those, just under 9000 were buyers who obtained a mortgage.  That’s and average of  nearly 9000 people getting a mortgage every day in this country.

Yes, it is not as easy as it once was to purchase a home, but there should be some level of work involved in accomplishing the American Dream.  Having good credit vs. marginal credit, having a down payment vs. no money down, proving you have a job vs. fogging a mirror, etc.  This is the old “skin in the game” theory.

The real estate market is such that the environment is creating an opportunity for first time home buyers to realize home ownership at a lesser monthly payment than renting.  With today’s prices and interest rates, the monthly payment on a mortgage can be less expensive than a rental.  Take into account the tax write off and you’ve got an even better scenario.  Surveys being done by experts are proving that the opportunity is now.

In any event, if you're considering a purchase in the near future and haven't spoken with a mortgage expert, it's never too early to do that.  It's also a great way to test them.  If you let them know you are looking to buy somewhere down the road and they don't give you the time of day because you're not buying now, that's a good indication of the service you'd get down the road.  I hear that all the time.  "You're the first person who would talk to us about this."  You also want accurate information about the process.  I can't tell you how many times I've heard someone say "My uncle told me I should do this" or "My cousin told me it was supposed to be this way."  Mortgage guidelines have changed a lot over the last couple of years and probably since your uncle or cousin went through the process.  Get the facts now and maybe even see what your credit report looks like.  You may need to "tidy up" in that department before being able to buy.  An educated consumer is the best defense against those "tighter guidelines."