I was talking to my favorite loan officer, Cheryl Stuntebeck at Edina Realty Mortgage, about the current market for loans. While most lenders have tightened up lending standards, the current loan loan products she has are almost identical to the ones she had 5 years ago. This means that 100% financing is very limited, that credit scores and income verification are necessarily most of the time, and that sanity has come to the lending market.
Some of the standout loan products today are geared to 1st time and/or lower income borrowers. Via government-sponsored programs there is still 100% financing with market rates and no mortgage insurance. No private loan program can beat that!
The loan products that we had 5 years ago worked just fine for consumers… we had great sales activity and low defaults in those years… and will serve us yet again. While lending has tightened, it isn’t like we’ve gone back to 1980’s style loans… there’s still a lot of great options in this market and I’m quite confident that qualified buyers will still be able to buy a home in this changed landscape.