According to recently released government data from the Home Mortgage Disclosure Act, credit continues to be overly stringent. Although buyers’ incomes have increased since 2004, the loan-to income ratio has declined. For example, the median income for a buyer using conventional financing rose from $79,000 in 2007 to $90,000 in 2011, while the national median household income stayed flat at $50,000 during the same period. The indication is that more loan applicants with higher incomes were applying and/or banks’ income standards became more stringent.

NAR’s 2012 Member Profile also revealed evidence of excessively tight credit conditions. Difficulty in obtaining mortgage financing was reported by 30 percent of all Realtors® as the most important factor limiting potential clients in completing a transaction.

Story Springboard

What’s The Impact? NAR research shows that a return to normal underwriting standards would result in an additional 10 to 15 percent increase in home sales. Read more about mortgage availability.

Notice: The information on this page may not be current. The archive is a collection of content previously published on one or more NAR web properties. Archive pages are not updated and may no longer be accurate. Users must independently verify the accuracy and currency of the information found here. The National Association of REALTORS® disclaims all liability for any loss or injury resulting from the use of the information or data found on this page.