Tag Archives: Credit Box

Before the housing crisis, borrowers could get a mortgage loan with little to no problems. Mortgage credit began to tighten when the crisis hit and has remained that way since.

The tightened credit box routinely blamed for curtailing a full-blown housing recovery turned a corner in the second half of 2015, with Quicken Loans reporting originations to borrowers with credit scores as low as 580.

Clear signs of recovery have been recorded in the housing market, but minority borrowers do not seem to be linked to this recovery.

The availability of mortgage credit to borrowers declined slightly in the second quarter of 2015, despite impactful federal efforts to expand the credit box.

The effects of the contemporary lending environment are rather significant. According to the institute, if the “cautious” credit standards of 2001 were in place in 2013, rather than that year’s “severe” standards, an additional 1.25 million loans would have been made in 2013.