Home Mortgages in Today’s Economy

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The State of the Mortgage Loan Industry

Perhaps you have heard how difficult it is to secure a home mortgage in todays economy. You could have heard that home loans are so hard to come by these days that you might as well not even bother. These are rumors, and they are patently untrue.

The way of mortgages today

Mortgage companies and mortgage lenders can and do make loans in any economy. The reason is very simple, if they choose not to make home mortgages available, they will not make money. Ask yourself, and be honest: Do you think home mortgage companies want to make a profit?” They obviously do.

Profit in mind

Over the past decade or so, most people looking for home financing have been doing so with one goal in mind profit. They saw the huge gains to be made through real estate investments, and no matter what was asked of them, theyd do it for the chance to take out a home loan.

Money is needed all over the world

Todays home mortgage market has a different type of customer. The dream of homeownership is still alive for many people. Consumers are no longer fixated on making profit from real estate. They are interesting in getting a home mortgage and purchasing a home for themselves and their families.

The housing bubble

Over the years 2006 and 2007, an estimated $ 2 trillion worth of mortgages were made to home mortgage consumers. Many of these home loans were made with little or no documentation. Essentially, many borrowers were allowed to sign their name and if their credit score was high enough, they could qualify for nearly any loan amount on a home mortgage they desired.The ignorance of risk for the sake of profit was one of the hands in what caused the bubble to burst.

The re-evaluation of mortgages

Lenders were forced to re-evaluate how they make home loans. However, that did not stop them from doing business altogether. Todays borrower can expect a much more detailed and intricate application process and all the necessary documentation to make a home loan will have to be provided.

More and more documents needed

Legitimate home loan borrowers who want to secure a home mortgage can do so if they are willing to endure the process in a more traditional fashion. You’ll have to provide proof of income, tax returns, credit history, and be willing to pay on time, every time. Your payment history on your credit report will accurately detail whether or not you will qualify for a home loan.

You can still get a home loan

That is not to say that you will not qualify if you have bad reports on your credit history. Mortgage lenders base decisions on who to give a mortgage to on a couple of principles. You must show the ability to pay the loan and make your payments in a timely fashion, and be able to document a willingness to do so. This is, and always was, the primary criteria for qualifying for a home loan.

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