Does a new report really reveal that mortgage loans are becoming easier to get, or is it all just more hype?
Ellie Mae, a mortgage origination software firm has released a new report suggesting that mortgage credit is becoming more accessible for those buying a home. So how much easier has it gotten since last year and where should you turn to for a mortgage loan?
The survey shows that the average FICO score for approved mortgages last month stood at 743. While high, this is down about 5 points since last year; a step in the right direction.
Still, Fannie Mae and Freddie Mac average credit scores for approved loans was a whopping 761 in March 2013. On the bright side average scores for FHA loans scraped in at a much more attainable 696.
For those interested in buying a home today it is important to note that the average denied credit score was 702. Of those approved, borrowers put down an average of 19% in March, with debt ratios of 23/35.
Of course not everyone agrees that mortgage loans are easier to come by today, including some loan officers on the street level. However, some have definitely seen their approval rates increase since last year, though perhaps partially because they have just gotten better at overcoming current underwriting hurdles.
Still with purchase loans rising by 5% of all mortgage originations and closing times coming down to an average of just 44 days there is little question that we are headed in the right direction.
The easing may not be coming deep enough and as fast as some would like, but based upon historical cycles will continue to loosen up with increasing velocity.
In the meantime, those not interested in waiting and missing out on the best deals may want to look to alternative lending sources such as private lenders, commercial mortgage brokers, business loans, peer-to-peer lending sites and hard money and transactional lenders specifically if flipping houses.
