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Nearly a third of Americans wouldn't qualify for mortgage!

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Ryan Smith | 29 Apr 2014, 11:47 PM Agree 0
Even with the housing market on the mend and rates dropping, three out of 10 Americans are unlikely to qualify for a mortgage.
  • Simon Dalambert | | 29 Apr 2014, 11:48 PM Agree 0
    Does this surprise anyone? Not everyone SHOULD own a home. Many individuals/families do not have the financial stability to take on the responsibility of home ownership. I am in the mortgage business, if you have a 620 credit score or lower, you have already demonstrated that you do not have the financial stability necessary for home ownership. This is not meant to be a knock on these families - just a recognition of economic reality. Good jobs are tough to find, wages are falling, health insurance coverage lacking, lack of savings. I see many clients who are really just getting by paycheck to paycheck. One hiccup and they are in real trouble. The historical rate of home ownership has been in the mid 60% range. During the last housing bubble when everyone could get a mortgage, regardless of credit score, income no assets, etc., the home ownership rate rose to approximately 70%. That did not end well for those families that were truly on the margin or most other home owners as well.
  • Edward Gambrill | | 29 Apr 2014, 11:51 PM Agree 0
    Maybe if you have bad credit, it should be harder to qualify for a mortgage. The belief that everyone should qualify for a mortgage, regardless of past credit performance, is one of the reasons we ended up in the mess we did.

    That being said, if you have a 620 credit score and a minimal down payment (3.5%), there are many sources of mainstream financing available at great rates.

    You won't find them at your local bank. You need to contact a mortgage broker, who will likely have a number of lenders to fill this need using the government insured FHA mortgage program.

    I have been a broker for a long time. I am convinced the broker is the consumer's best friend.
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