Home Loan Requirements, Staten Island NY Real Estate

Buying a home? Finding the perfect home may not be the hardest part of the process. Securing a mortgage is much harder today than it was in the past. Today, the number of home loans that get approved is about 3 in 10, as opposed to 9 in 10 just a few short years ago. Today the standards for obtaining a home loan are much stricter.

The first requirement is good credit, you will need a credit score of about 740. You may be able to get a loan with a lower score, but expect to pay higher rates. You will also face greater scrutiny of your finances, you must be able to verify your income and deposit. Most lenders will check and recheck your financial situation. Aside from your credit score, most lenders will require a 20% down payment, and will turn you down if your debt exceeds 36%. Even if you meet these requirements you may still be turned down, as the requirements are ever changing.

Then there are the appraisal issues. With the large number of short sales and foreclosures on the market, homes are not appraising for the contract prices.

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Independent contractors and small business owners are also finding it hard to secure a loan since they do not receive a regular weekly paycheck. It is getting harder to get low or no income verification loans.

If your looking to buy a condo, it may be even harder for you to get a mortgage, because the bank has to approve the buyer and the condo association.

These tighter mortgage standards may seem like a bad thing, but the upside is that with more qualified buyers, there will be less foreclosures in the future.