Poll: Should Lending Criteria be Eased?
Existing home sales rose 2.7% in January mirroring much of the economy’s expansion efforts. However, a closer look at the sales growth shows that a disproportionate amount of the sales were made in cash by real estate investors and not homeowners. Investors are taking advantage of the current market conditions and are getting properties below market value. Many are able to pick up the properties over homeowners because the investors are bringing cash to the table. Potential homeowners often don’t have the cash or ability to get a hard money loan like investors do. The National Association of Realtors Chief Economist Lawrence Yun believes that more homeowners would like to purchase properties but current tight lending guidelines prohibit many from getting in the game. On the other hand, easing the lending criteria could lead to more foreclosures down the road and round two of the Great Recession.
This is where you get involved:
Should credit and lending institutions ease lending criteria to get more potential homebuyers in the game and hasten the recovery?