In the business world, so many consult the bottom line and then begin to search far and wide for something or someone to blame when it does not match what they see or wish to see.  The same can be said here regarding the fall of mortgage applications.

Being a former mortgage specialist, lenders send out a matrix of the requirements to secure a loan with their individual companies.  Mortgage professionals then search for clients who meet those requirements before putting together a mortgage application.  Many mortgage professionals will not waste their time putting together an application that they do not feel has a good chance of passing underwriting by the lender.  One of the major points of decision for lenders is and always will be the individual’s credit score.  All else can match up perfectly with the lenders requirements but if the credit score does not, there is no loan.  The entities who control how credit scores are figured are none other than the credit reporting agencies.  They have their particular algorithms that they use to decide what scores prove to them how credit worthy you is.  If you are lucky, you may fit within their guidelines of whom worthy and who’s not but I you don’t then as Representative John Boehner says “so be it”.

According to an Al Yoon article for Reuters titled Mortgage applications fell last week: MBA, “applications for U.S. home mortgages dipped last week despite increased refinancing, an industry report said on Wednesday, suggesting still-stunted demand as the spring selling season nears.”  How many of us know exactly what a “still-stunted demand” is?  It’s as simple as if the credit reporting agencies are convinced to raise the credit scores to 740 that means only those with that score will qualify for a mortgage and those under it will not have an application written.  For those who disagree, please take a few minutes to look backward to when “A+” credit used to be 620 and above just before the financial meltdown.  The mathematics used to calculate these scores are ever changing and depend on who has the ear of those in charge could be almost any number.  Bottom line is to blame the decrease on the lack of security in the market is false and it is about time we examine the real cause behind the haves and the have nots when it comes to securing a mortgage.

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