Qualifying For Mortgage Loans Getting Easier, Bank Regulators Say

Although mortgage requirements remain tight, you might find qualifying for a mortgage slightly easier. While bank examiners admit that qualifying for a mortgage and other types of loans can still be difficult, they’re beginning to see signs that lenders are easing their loan standards.

Using a mortgage qualification calculator or a mortgage payment calculator is an easy way to determine your monthly payments and find if you qualify for a mortgage. Use a mortgage payment calculator.

Competition between banks and slight improvements in the credit markets are prompting looser standards for qualifying for mortgages and other loans, say regulators at the Office of the Comptroller of the Currency. They expect lending terms to continue to loosen next year.

Out of the banks participating in the OCC’s annual Survey of Credit Underwriting Practices 59 percent said their underwriting standards, or their mortgage qualification requirements, had tightened. That’s a large drop from last year when 73% said their mortgage requirements tightened. Plus, 5 percent said their mortgage qualification requirements got easier. In the previous two years, no banks said their mortgage terms got looser.

Home equity lending requirements also eased slightly. Fewer banks increased their home equity underwriting standards and some loosened their home equity loan requirements. The OCC said 60 percent of banks tightened home equity requirements, compared to 78 percent last year, and 5 percent loosed terms, compared to zero last year.

“Credit performance remains a concern despite several years of tightening,” said Deputy Comptroller for Credit and Market Risk Dave Wilson. “We are beginning to see some recent signs that standards may be loosening. That’s good for credit markets as long as bankers remember to stick to sound underwriting principals and do not compromise standards because of competitive pressures or the assumption that loans will be sold to third parties.”

Falling mortgage interest rates have made qualifying for mortgages easier for both home buyers and home owners refinancing. View low mortgage rates.

To complete the survey, OCC compiled bank examiner observations and survey 51 of the largest national banks over 12-month period. The total of loans involved in the study was $4 trillion, representing over 93 percent of all outstanding loans in the national banking system.

If you have a question about qualifying for a mortgage loan, please contact one of our qualified mortgage bankers at 1-877-868-2503.