Over the last six months, the average credit score of an approved borrower was a whopping 750. The average score of a borrower denied mortgage credit was 704!
These are amazingly high scores in light of the fact the average score of borrowers in the 25-34 year old (First Time Buyer) range is only 649. The average score is even lower for the 35-44 year old range.
The bad: The above statistics indicate how huge of a portion of a potential borrowers and buyers are currently shut out of the market.
The good: (1) The above statistics shocked regulators and most everyone in the mortgage industry. As a result, there is enormous pressure to loosen lending guidelines or to find financing alternatives for borrowers who are not “perfect.” And (2) The huge “shut out” portion of borrowers represents a tidal wave of potential demand (Americans do not like renting). The market will eventually find a financing venue for that tidal wave. For those of us (realtors and lenders) willing to “stick it out”, another buying “boom” probably lies ahead.
Founder/Broker | JVM Lending
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