There has been new research by mortgage marketplace experts for both credit scoring and foreclosures. The first states that any potential borrower with a credit score less than 640 is unlikely to receive a 30-year fixed-mortgage even if they offer a relatively high down payment.

Yet, according to several credit scoring depositories, 29.7 percent of Americans have a credit score below that number and even lower than 620. This means that nearly one-third of Americans would likely be turned down for the nation’s most popular mortgage product.

Any homeowner whose credit score was 720 or higher were able to secure some of the lowest rates in the industry for a 30-year home loan hovering in the 4.1 range.

Mid-range credit scores, between 620 and 719, received annual percentage rates from 4.44 to 4.73 percent. Those with credit scores below 620 received too few loan quotes to calculate the average annual percentage rate.

Most economists and mortgage professionals attribute this trend to a tightening of credit standards, which most see as a good thing for now.

Most experts are saying that since 2006, sub-prime loans were very easy to get approved for and those who were and couldn’t afford their payments helped create this mortgage fiasco.

Thus, today’s tighter credit is a predictable response by banks after the foreclosure crisis. But this current mentality also keeps a cap on housing demand, which may prove to be important for the greater housing market recovery.

No one can deny the fact that this foreclosure market has also played a huge hand in the banks’ decision making process. In fact, there is close to 7,053,000 mortgages in the United States that are 30 or more days delinquent or will be heading towards foreclosure.

There are reports that a housing database showing 39.9 millions home loans has proven beyond the shadow-of-a-doubt loan modification programs have not helped homeowners in the least bit.

Taking a closer look that these disturbing numbers, of the 7 million loans that are not being paid, about 2,043,000 are already in foreclosure proceedings looking for assistance for a loan modification or seeking attorney based principal reduction programs.

The rest of the 4,934,000 are currently in what we call the pre-foreclosure stages with close to 50 percent of these being 90 or more days late on their payment.

So, the nation’s pre-sale foreclosure inventory rate which hovers around the 3.83 percent is up 1.3 percent from the August 2010 reading and 3. 76 percent above the 2009 rate.

These foreclosure statistics along with the fact that nearly one-third of Americans cannot buy a new home tells us that this housing crisis is no where near being finished and that it could take years for a full recovery.

To learn more about a principal loan reduction, stop by Floyd J. Tapia’s site at www.StLouisMortgageGroup.com. Principal Reduction Program: Better than loan mods. Save your home with a foreclosure stop or if you are underwater. Call us at 314-334-0210 or 877-334-0210.

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