The definition is gunshy. You cut off the tip of your finger using a circular saw and your going to be careful until that becomes a distant memory. I can't say I blame them, most lenders have lost there ass and they can't afford another run of losses.
I can't honestly say I feel anybody that deserved a home loan has been denied in the last 3 years in my presence. You can still obtain a loan as a veteran with $1 down and an FHA with 3.5%. Not exactly much assurance for the lender. If it wasn't government insured, it would never happen today. Conventional loans require a minimum of 10% and that's if you are iron clad and it's a primary residence. Mortgage insurance won't be as inexpensive as it was 3 years ago. In many cases the lender will loan the money but there aren't any Mortage insurance companies that will write the policy. With that being said, almost every conventional deal I've done in the past 3 years has been 20% down. Over a 1/3 of my transaction in 2009 were Cash.
Then there is buying power. Sure the low down payment government loans are available, but they stand little to no chance against a conventional buyer. That's the way it should be. Those that are most financially able should have more buying power and obtain the best property. That's a variable that went by the wayside. Anybody with a fico score and a pulse could get a conventional loan 3 years ago.
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Todd
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