Since when did getting a mortgage become synonymous with an FBI background check? Why do they need so much paperwork? Is my lender watching me right now?
According to Keeping Current Matters, there are two reasons why getting a mortgage requires more effort today:
The bank has set new guidelines that requires the lender to prove, beyond all reasonable doubt, that buyers can afford to pay their mortgage. A product of the housing crisis, this ensures that strict qualification standards are met to avoid another 2008 catastrophe.
The banks don’t want to be in the real estate business. Since 2008, the banks have had the burden of taking on millions of foreclosures and short sales. The new guidelines are a safety net against a repeat of that.
The good news is that with stricter guidelines also came lower rates. People that paid 7-9% on their mortgages would probably bend over backward to get a 30 yr fixed at today’s rates.
Real Estate Agent
Golden Gate Sotheby’s International Realty