The housing industry has blamed banks’ tight mortgage standards as preventing many potential buyers from being able to purchase a home. But a new survey by the Office of the Comptroller of the Currency shows that more banks are finally easing up on their standards, which may open the doors for more buyers to qualify for a mortgage.
About a quarter of the banks reported tighter underwriting standards for home loans, which is down from 40 percent last year, according to the survey of 87 of the largest banks. Ten percent of the banks surveyed say they’ve eased their standards on mortgages, compared to only 8 percent who said that last year.
“This year’s survey showed the continued normal progression toward stable or easing underwriting standards as the economic environment stabilizes,” says John Lyons, chief national bank examiner at the OCC. “Examiners will be focusing on underwriting standards as banks ease standards to improve margins and compete for limited good loans.”
Source: “Fewer Banks Tighten Mortgage Underwriting Standards,” HousingWire (June 28, 2012)
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