There is an article in the Wall Street Journal today how home prices have dropped just under 30% in the 10 biggest cites in America. At the same time, we’re getting reports from the National Association of Realtors how “sales are going up and that this is the time to buy.”
Well whether it’s the time to buy or not, I don’t know. What I do know is that lending guidelines are continuing to get tougher and tougher. Part of the reason is because the credit scoring requirements are continuing to go up and up.
Here is the disconnect: the lending guidelines and credit scoring requirements continue to go up and there is no education about the guidelines or credit scoring. People think if you pay your bills on time, you’re going to have perfect credit, which is WRONG. So until more people can qualify by teaching individuals that paying your bills on time is not necessarily going to guarantee you a perfect credit score… there is going to continue to be disconnect, which will impact how significantly the real estate market can recover.
