Mortgage rates are at record lows, with 30-year fixed-rate mortgages—the most popular choice among home buyers—averaging in the 3 percent range for the last several weeks.
So how can home buyers snag such low financing for their home purchase?
Banks have tightened their lending standards in recent years, which has put such record-low rates out of reach for many home buyers. To get a loan, borrowers find that lenders scrutinize their credit scores, income, employment history, liquid assets, down payment, property value, type of property (single home vs. multifamily, for example), and how much money they’ll have left after closing, The New York Times reports. Mortgage brokers say the greatest challenge in processing a loan nowadays is “documenting your income and every bit of information on your application, down to the last $200 your mother sent you for your birthday.”