Many reasons a mortgage application could be rejected

More applicants are seeing their loans rejected.In the wake of the housing market crash, banks have been much tougher about who they give mortgages to, rejecting one out of every four applications. CNNMoney says there are a number of reasons a loan may be turned down.According to the source, Fannie Mae and Freddie Mac are being stricter in their credit requirements, and aren't being as lenient with missed credit card payments, debt ratios or credit scores.”The pendulum has swung too far in the other direction,” Jerry Howard, president of the National Association of Home Builders, told CNNMoney. “This overreaction is retarding the housing market recovery.”In addition, increased restrictions on condo sales have made it more difficult for condo buyers. In order for loans to be bought by Fannie Mae and Freddie Mac, 70 percent of the units in the association need to be under contract or sold, up from 51 percent just two years ago. Some analysts say lenders are being too restrictive, and holding back the recovery.The condo restrictions may be playing a significant role in the Houston real estate market. According to the Houston Association of Realtors, the number of condos sold in March was down more than 16 percent compared to last year.Courtesy of 2M Realty News

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