[quote=HLS]With home ownership recently approaching 70%, there is another group that has no interest in buying a house and yet another group that cannot qualify for a loan for various reasons.
What is left seems to be a very small slice of interested buyers who can qualify for a loan by today’s guidelines.
I am seeing a number of people with some but not all of the following: high credit scores, lots of cash, low debt and a job, but for one reason or another they do not qualify for a loan.
Those with a recent foreclosure will not be able to buy for 2 to 5 years based on current guidelines.
I believe that the % of the population that can qualify for a loan is possibly the lowest that it has ever been.
Many people that want to buy a house have absolutely no chance of buying now.[/quote]
I doubt it’s the lowest… Prior to the change in lending requirements you needed good credit and a good down payment (plus the income to meet the payments.) 20% down was minimum. We still have programs that let you put very little down – so there are more people that qualify now than did 30 or so years ago.
Factor in the fact that banks used to redline black neighborhoods – so that also reduced the number of people who qualified for loans. (It’s where the term redlining comes from – the maps banks had that showed where not to make mortgages because of the demographic makeup. The areas that were unloanable were colored in red.)
I don’t want to see redlining return. But I am very much in favor of bringing back the underwriting standards of old – you needed to save (a LOT) for a downpayment. You had to have a good, long term, career/income and you had to have very good credit.
