Here's the 1st one

I'm trying to think of a way to keep all my friends, customers and associated informed on changes in the mortgage industry.

It seems like there's changes every week, and they really affect a borrower's ability to buy a home or refinance.

Since I've been in mortgage lending for 23 years, it's interesting that we are back where we were 20 years ago. Back when I started in lending, you needed 20% down, had to pay your bills on time and have a stable job. You may think DUHHH but over the past 5-10 years, guidelines have loosened up so much you didn't need any down payment, and you didn't even have to list a job or income! There was a lot of greed out there. It didn't matter that people couldn't afford the homes, all that mattered was to do more loans. This is everyone's fault, not just lenders. Did you have a retirement account? Did you want 12-20% return on your investment? Your retirement account probably invested in mortgage backed securities. The more loans that were done, the highter returns we were all getting on our 401K's. That's kind of simplifying it a bit, but the guidelines kept getting more and more lienient because of the hunger to do more and more loans.

With the Mortgage Crisis the lending guidelines have done a complete 360.

Here's an apprimate comparison:

1990 Had to prove you pay your bills on time, needed a down payment from your own money, they wanted 28% of your net income for your house payment, real estate taxes and insurance, and 36% for housing and all other monthly payments. You had to have a stable job with a 2 year history.

2006 Didn't even have to disclose income or job if you had a credit score in the upper 700's. You could get a zero-down loan, combo loans allowed you to have zero down and pay no mortgage insurance, you could get a loan 1 day out of bankruptcy.

Today: Most loans (there are Federal VA and Guarantee Rural Housing with zero down yet) need 5% down and it has to come from your own funds. FHA needs 3.5% down and it can all be a gift from an immediate family member. Most loans allow you to stay around 40% of your pre-tax income for all your monthly debts. Very difficult to get a loan with a credit score under 620 and you'll pay a higher rate it it's not 740 and above.

If you were pre-approved for a loan a month ago, get back in touc with your lender to make sure there weren't any guidelines changes that would prohibit you from getting a loan.

If you follow my blogs, you'll eventually see that it may not be what you want to hear, but I will tell you the truth. I don't tell you I can do something I can't.

I look forward to builing a blog-following! E-mail me any time if you have questions regarding home loans.