Is it becoming harder to get a mortgage? Looks as though it is.

Marc Santora of The New York Times writes about “New Worries for Buyers Seeking Mortgages.”


Frankly, there are horror stories out there about getting mortgages.

For one prospective apartment buyer,

“the moment she stepped into the two-bedroom apartment at 59th Street and First Avenue, with its oversized windows and sweeping views of the Queensboro Bridge, she just knew.”

And her offer was accepted.

“That was in August. But it was only in February, nearly six months later, that she finally closed on the $1.15 million apartment.

“In the intervening months, as she battled through a computer glitch and reams of documentation, Ms. Herman underwent a crash course in the complexities of navigating the mortgage market — which itself continues to undergo profound change.”

 “The dread of not finding a lender after the market collapsed in 2009 has been replaced by uncertainty, confusion and frustration. According to brokers and lenders, the list of demands that stand between finding a place to buy and signing on the dotted line simply never stops morphing.“

And it looks as though more change are coming to the mortgage market as the Obama administration plans to reduce the role of the federal government in the mortgage market by, for instance, lowering the limit on loan amounts for loans to be bought by Fannie Mae and Freddie Mac as well as reducing loan amounts for FHA and VA loans.

“And let’s not forget the federal government’s proposal to eliminate the mortgage interest tax deduction for high-income earners; the changes in the way brokers will be compensated because of new regulations; and the fact that banks — despite recent profits — are still leery of lending. Taken together, all these elements create a situation that can paralyze potential buyers. “

The result of all this is that “confusion and uncertainty can have the same impact as fear, unfortunately,” said David S. Marinoff, a mortgage broker and managing director of the Guard Hill Financial Corporation."

Summing up the problems facing the market is this from Jonathan J. Miller, the president of the appraisal firm Miller Samuel and a market analyst for Prudential Douglas Elliman,

“housing does not truly recover until lending does. It is currently dysfunctional.”

Once again the crystal ball goes dim.

Read the full story.

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