Mortgage Rate, Lending Guidelines Round-Up – February 14, 2009

After dropping over 1 point over the last few months, mortgage rates are back up hovering just over 5 percent. Mortgage rates took a little dip last Tuesday after Tim Geithner's less-than-detailed/non-specific speech about the government's financial rescue plan and overall concern surrounding the stimulus bill.

As far as whether it's getting easier or harder to get a loan, that hasn't changed much. Getting a loan still requires good credit (typically 720 or higher), money down (at least 3.5% percent if you go FHA/VA) and full documentation (you mean I have to prove that I make what I say I make?!). Here's a quote from an article on BankRate.com regarding lending guidelines:

"In short, lending standards are a lot tighter than they were in the go-go period of around 2002 to 2007. On Wednesday, the House Financial Services Committee held a hearing in which financial services CEOs were asked what they did with their federal bailout billions. The CEOs said their institutions have been lending lots of money. Their implicit message was: Please don't ask us to loosen lending standards.

Vikram Pandit, chief executive of Citigroup, told the committee that his company lent $75 billion in new loans to consumers and businesses in the last three months of 2008 and that it will continue to lend "in a responsible and disciplined manner." Later in his statement, he said lenders have tightened credit and that, "in this difficult environment, Citi will not — and cannot — take excessive risk with the capital the American public and other investors have entrusted to the company." (Citigroup has received $50 billion in TARP money, or $351.87 from every working American.)"

Money is still available to those who are in the financial position to buy a home - it's just more strict than before (which is a good thing overall). If you have good credit and money to put down, you're sitting pretty right now.