Mortgage lenders slack off after tightening restrictions
Some loan officers are now seeing lenders ease their restrictions put in place at the start of COVID-19 hold orders.
SACRAMENTO, Calif .– You may have seen the advertisements for low mortgage rates, but in the process some have found themselves unqualified.
“A big change has been the credit score,” said Diana Ramirez of Almond mortgage. “We have gone from the possibility of making 580 credit scores to the bank which must now do 640 or 680”.
Ramirez says lenders are also stricter on employment. If you are self-employed, you must have more proof of savings than a regular employee.
“It’s more stringent than an ordinary W-2 person because now the banks for the self-employed are asking [for] 12 months of their mortgage saved on their bank accounts, ”Ramirez said.
Cam Villa, loan officer for Golden Bay Mortgage Group also saw the challenges.
“It’s much more difficult,” Villa said. “One of the things I have seen is minority business owners, so people under 25% business owners, many banks don’t allow them to use that income because it doesn’t seems not stable at this point. “
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However, over the past week, loan officers have seen lenders slack off.
If you want to be approved for a lower rate, be sure to check your credit.
Villa says if you need to improve your credit score, you can do it and see results in a month. He recommends that people keep balances below 50% of the total limit and make multiple payments one month before the due date.
“A lot of lenders have another secret tool, something called a quick rescore,” Villa said. “So if I run your credit report and say hello, I can improve your score by 20 points if you pay off those $ 500 to $ 1,000 debts, what happens is you update that balance and I submit them to the credit bureaus, they immediately review these and adjust your score accordingly.
The process can be intimidating, but the people are approved.
Dana Fleischman, who runs a local gym, had to have her income verified 10 times, but got her loan during the pandemic.
“Overall, we got there,” Fleishman said. “It just takes a little longer.”
If you want to get started, make sure you have a copy of your most recent mortgage statement (if you have one), your last 30 days pay stubs, and the most recent W-2.
From there, find a mortgage advisor to help you through the process.
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