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 June 15, 2007

Are Revised Lending Requirements Blocking Out First Time Home Buyers?
Approximately 500,000 first time home buyers are being blocked from entering the housing market. This is a result of tighter lending standards recently imposed by subprime lenders. This information is reported by the National Association of Home Builders.
As a result of these tighter lending standards, organization officials are worried that a drop of that magnitude could result in as much as a 4% drop in new home sales with sales of existing homes falling by as much as 7%. The very prospect of this outcome has sent the shares of several new home builders tumbling on the stock market in recent months.

Washington Mutual, Inc. is reporting that tightened credit requirements coupled with the closing of 50+ mortgage companies should result in a reduction of subprime loans to #350 billion this year. This would reflect a 47% drop from 2005.

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