Several Changes are coming to the mortgage market soon.
First, effective 11/16/2013, FNMA will no longer allow a maximum LTV (Loan To Value) ratio greater than 95%. Currently, they will allow a 3% down payment for borrowers with great credit. After 11/16 all borrowers will have to have a minimum down payment of 5% to get Conventional Financing (FNMA and FHLMC)
Secondly, effective January 10th of 2014, all borrowers will be subject to the CFPB (Consumer Financial Protection Bureau) Qualified Mortgage Guidelines that will mandate that the maximum Debt To Income Ration for any borrower will be 43%. This can currently go as high as 55% for FHA and VA loans.
What does all this mean? The line for marginal borrowers has been moved. If you are borderline with either of these regulations, then you should plan to purchase soon.
If you are interested in the full report on the changes being implemented by the CFPB, or if you just have trouble sleeping, check out their web site at: http://www.consumerfinance.gov/regulations/ability-to-repay-and-qualified-mortgage-standards-under-the-truth-in-lending-act-regulation-z/ . Happy Slumbers.
