The following article makes some very interesting assumptions without looking at facts. I am not being negative or a hater I just find the media in general to not take the time to inform themselves properly on the actuality of what is going on. Credit score is now on average lower to get loan 700 from 720. More homes than ever are being purchased with FHA loans. FHA loans with some lenders is 580 credit score most banks is 640. This does not mean that lending has been loosened up just that realtors and lenders have relearned how to do FHA and VA loans again because that is how to close transactions. Credit loosening, I have not seen credit loosening I have seen it tighten up more not less. Again conventional loans have stricter 28/42 debt ratios and FHA does not have such tight rules. FHA can go 55% back end combined debt ratio if it will pass DU underwriting. We are not getting lessening of credit again adjustment of loan officers and realtors Shifting with the market. LTV loan on loans, again FHA which is 96.5% LTV and conventional is 80% LTV. None of the FHA information was factored into this report. They did not address the 5million plus homes in shadow inventory that are still sitting out there. We are not in a housing recovery mode yet however we might be going in the right direction. The real key to the housing crisis is jobs. If people are working the short sales stop and foreclosures go back to normal numbers. These are the things that will make a huge impact in the economy until it gets to that point we have to Shift to the market and make the most of what we have. We have a long road a head however we can still make a living and succeed, we just need to remain positive and know what is going on so we do not become reactive and stay proactive on what we are doing. Housing Crisis to End in 2012 as Banks Loosen Credit Standards 01/24/2012 By: Krista Franks Printer Friendly View Email Enter your email to receive Daily Email Updates: Capital Economics expects the housing crisis to end this year, according to a report released Tuesday. One of the reasons: loosening credit. The analytics firm notes the average credit score required to attain a mortgage loan is 700. While this is higher than scores required prior to the crisis, it is constant with requirements one year ago. Additionally, a Fed Senior Loan Officer Survey found credit requirements in the fourth quarter were consistent with the past three quarters. However, other market indicators point not just to a stabilization of mortgage lending standards, but also a loosening of credit availability. Banks are now lending amounts up to 3.5 times borrower earnings. This is up from a low during the crisis of 3.2 times borrower earnings. Banks are also loosening loan-to-value ratios (LTV), which Capital Economics denotes “the clearest sign yet of an improvement in mortgage credit conditions.” In contrast to a low of 74 percent reached in mid-2010, banks are now lending at 82 percent LTV. While credit conditions may have loosened slightly, some potential homebuyers are still struggling with credit requirements. In fact, Capital Economics points out that in November 8 percent of contract cancellations were the result of a potential buyer not qualifying for a loan. Additionally, Capital Economics says “any improvement in credit conditions won’t be significant enough to generation actual house price gains,” and potential ramifications from the euro-zone pose a threat to future credit availability. Recent Articles