“Housing Crisis to End in 2012 as Banks Loosen Credit Standards”

Capital Economics expects the housing crisis to end this year, according to a report released Tuesday. One of the reasons: loosening credit.

The analytics firm notes the average credit score required to attain a mortgage loan is 700. While this is higher than scores required prior to the crisis, it is constant with requirements one year ago.

Additionally, a Fed Senior Loan Officer Survey found credit requirements in the fourth quarter were consistent with the past three quarters.

However, other market indicators point not just to a stabilization of mortgage lending standards, but also a loosening of credit availability.

Banks are now lending amounts up to 3.5 times borrower earnings. This is up from a low during the crisis of 3.2 times borrower earnings.


We are in about the third week of the buyers coming back to the market.  I have visited multiple real estate offices in the last week to hear each office talking about what is happening in their city.  The stories are all the same.  Buyers are back and are not only eating up all of the standard sales, they are standing in line and writinig offers on Short Sales.  I had over 80 people at my last short sale grand opening and sold it in 4 hours. 

What should you do?  First of all, don’t be ‘doing it’ on your own.  Sign up to work with the best agent to represent you and treat you like a full-time job.  I just had  buyers I met 6 months ago at an open house call me up and ‘hire’ me.  After 3 weeks of looking all over Orange County, we wrote an offer the day the home came on the market.  We paid just over asking price and beat out all of the other offers.  They sent me a nice letter of their experience.  I will post it soon.   It is time to buy NOW before the sellers starting demanding more from their buyers.

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