Mortgage News Update: Lending Environment Easing for Prospective Home Buyers

Faster closing times and looser credit requirements make homeownership attainable for more prospective buyers.

Many people have postponed buying a home because of media reports of a highly restrictive lending environment. Others who have been approved for a home loan have had their offers for a home declined because a cash buyer was able to close the home sale more quickly than a bank could close a loan. Fortunately, according to a report in Realtor Magazine, lenders have started to close mortgages more quickly and they have loosened their credit criteria somewhat based on data obtained from Ellie Mae.

A Window of Opportunity Opens for Prospective Home Buyers

According to Ellie Mae’s July Mortgage Origination report, the average closing time for a home mortgage was only 37 days in July, which is four days less than the closing time in June. In July, FHA and VA loans closed in 28 days on average and the average time to close a conventional loan was only 36 days. In a real estate market where inventory for affordably priced homes is tight, the ability to close a transaction quickly puts you at an advantage if you are in a bidding competition.

For homebuyers with less than perfect credit, the good news is that 32 percent of the mortgages that closed in July had FICO scores less than 700. Additionally, the number of closed home loan transactions increased by 67 percent in July, which is the highest rate since 2011.

For expert help with your mortgage application and a quick closing, contact a local mortgage broker today.