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Why Are Mortgages Harder to Get?

The housing market is going back up, according to's Real Estate Now Blog. In some areas, it's booming.

Boston is no stranger to this phenomenon. Back in the day, it had a booming market and overpriced homes.

Now, as the market is recovering, we're seeing history beginning to repeat itself.

Of course, history can repeat itself in some ways but not in others. So while house prices might be rising, it looks like the banks might have taken a hint from the housing bubble mess.

And from the looks of it, they're not keen on repeating their mistakes.

Remember the housing bubble of the early 2000s? Homebuyers were getting mortgages left, right and center. In fact, it looked like all you needed was to have a pulse in order to land a mortgage.

But today, according to's Real Estate Now, it's not that easy. The blog cites a UPI report that found 40 percent of potential buyers are getting shot down by mortgage lenders.

In fact, some potential homebuyers get far into the process, only to have the line go dead on them when trying to get a mortgage.

Credit scores are becoming increasingly more important when trying to get a mortgage. They always were important but now, a score of 680 is a must, according to Boston Real Estate Now.

And the debt-to-income ratio is also being taken into account a lot more. The total debt of a potential homebuyer must not exceed 43 percent of the borrower's income, reports Delaware Online.

Furthermore, those without W-2s will have a harder time getting a mortgage. So for those who are self-employed, the mortgage process is a bit more difficult. In the past, all borrowers needed was to state their income. But now, documentation is much more critical in applying for a loan.

Mortgages are harder to get. That's the bottom line. If you're getting into the housing market, you'd better have a good down payment handy.

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