While the COVID-19 crisis has put the brakes hard on the real estate market, deals are still getting done especially with interest rates at all times lows.
However, lenders are raising their standards for loan approvals which will lead to less approvals in the current environment, potentially leading to a decline in prices if the number of impacted buyers is large.
Chase Bank has raised their down payment to a minimum of 20% for owner-occupancy loans for single-family homes and condos and FICO scores generally now much be above 700.
Earlier this year self-employed individuals were able to get approved with 10% down payments for non-qualifying mortages (non-QMs) however these loans also typically are also now at 20% minimum down payments and some lenders in this space have put their loan programs on hold.
Changes for the benefit of borrowers will have to wait to see how the economy performs later in 2020 before down payments will begin to decline.
Borrowers looking to get home equity lines at Chase and Wells Fargo are also out of luck as these products are on hold for the moment.