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If you couldn't buy a home last year...

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You may be in luck this year. Lenders are relaxing their credit requirements significantly. Required FICO (Credit) scores are going down, and debt to income ratios are going up (in other words, you can have more debt than before and still buy).

What has not changed is the advance in prices, although that appears to have abated somewhat. In our firm, we have seen many of the agents having to get their sellers to reduce pricing in order to sell, and "Just Reduced" is now a common way to advertise.

We are moving toward what many might call a "more normal" real estate market, where buyers and sellers negotiate, and where lenders will lend money to creditworthy borrowers, even if they are not "sterling" in quality. Required FICO scores still remain high, and the mortgage insurance required for less than 10% down is still pretty draconian. Fannie Mae and Freddie Mac continue to rule the roost in the secondary mortgage market. When that begins to change (banks assume their own risk, or sell to private investors) rather than selling it to US government sponsored entities), the market will truly be on the road to recovery.

For now, you may be able to buy that house you couldn't buy last year.

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