Good news for potential home shoppers: A Mortgage Bankers Association index shows lender requirements regarding credit scores, down payments, and other key terms are finally loosening up. Some lenders are even expanding the types of mortgages they offer. These moves come after years of lenders tightening loan requirements in the aftermath of the housing crisis. Click to read more
What are some examples?
Fannie Mae is now allowing purchases of conventional mortgages that have down payments as low as 3 percent.
Freddie Mac is planning to begin similar 3% down loan purchases for mortgages closed on or after March 23.
The FHA program began offering lower mortgage insurance premiums.
Wells Fargo lending trends – They have relaxed their policy on gifts to borrowers by relatives and friends to defray part of the down-payment and closing costs. On FHA applications, the bank will now accept FICO scores as low as 600, down from its previous 640 standard.