It may get a little harder for some hopeful home buyers to qualify for a loan as Fannie Mae is tightening the standards. Some of the changes include:
- Increased credit score required (up to 640 from 620)
- More tax returns to be reviewed for self-employed applicants (up to two years from one year)
- Change in maximum loan-to-value ratios for ARMs (down to 90 percent from 97 percent)
It is estimated that some of these changes could really affect a large percentage of people applying for loans, specifically self-employed and low credit score applicants. Some good news for borrowers is that some guidelines will actually be loosened such as:
- Change in loan-to-value ratio for some fixed-rate loans on two-unit properties (up to 85 percent from 80 percent)
- Down payment will drop for some co-op loans
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