Starting Today It Will Be Easier to Get a Mortgage

Starting on Monday, it could get a bit easier for borrowers to get a mortgage.
New guidelines from Fannie Mae and Freddie Mac that go into effect December 1 relax the standards that lenders have been using to approve mortgages, The Wall Street Journal reports. Specifically, some lenders will now be able to move forward with borrowers that have a credit score of 620, the lowest backed by Fannie and Freddie, among other changes.
Previously, banks often had more stringent standards than Fannie and Freddie. Those standards, called “overlays,” made the bar higher for borrowers hoping to secure a mortgage from a bank in spite of lower requirements from the two mortgage giants. The Journal reports that several banks, including Wells Fargo and Sun Trust, are getting rid of their overlays in light of the update to the guidelines.
The Urban Institute said that relaxed standards could open up mortgages to about 1.2 million people. The same institute reported earlier this year that 1 in 3 Americans with a credit report had debt in collections. The relaxed rules will now probably make it easier for people with one-time lapses in their credit history to get a mortgage.
See other articles related to: mortgages, freddie mac, fannie mae, credit score
This article originally published at http://dc.urbanturf.com/articles/blog/lenders_relax_standards_for_mortgage_borrowers/9278
Most Popular... This Week • Last 30 Days • Ever

UrbanTurf is re-running its primer on property taxes which outlines a few things that... read »
UrbanTurf has compiled virtual looks at large new developments around the DC region.... read »

The 11th Street Bridge Park project is progressing through the approval process.... read »

Another 30-day public comment period is currently underway.... read »

To illustrate the rise in prices, UrbanTurf analyzed four charts that show the path o... read »
DC Real Estate Guides
Short guides to navigating the DC-area real estate market
We've collected all our helpful guides for buying, selling and renting in and around Washington, DC in one place. Visit guides.urbanturf.com or start browsing below!
First-Timer Primers
Intro guides for first-time home buyers
Unique Spaces
Awesome and unusual real estate from across the DC Metro