Piedmont CA Real Estate Agent Broker Anian Tunney Comments on Credit Score Requirements for Mortgages

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Anian Tunney, Piedmont CA real estate agent broker, weighs in on why new mortgages require such high credit scores.

In June, the average credit score for people granted a new mortgage was 755(1) – on a scale of 300 to 850. While credit scores are not the only factor considered when considering a mortgage application, what lenders are requiring is well above historic norms and is causing problems for many would-be home buyers. In fact, the rate of home ownership for Americans younger than 35 is roughly 36% – the lowest on record.

“Homeownership is such a key component to a healthy economy; lenders cannot be so strict on credit scores at a time when everyone is recovering,” commented Anian Tunney, a Piedmont, CA real estate agent broker. “A person’s credit score tends to lag behind their own recovery,” Tunney explained, “that does not mean they are not qualified for a mortgage.”

Founder and Chairman of America's Homeowner Alliance, a nonprofit group that promotes affordable housing, Phil Bracken agrees and considers the current level of homeownership (the lowest since 1995) a national problem.

Even the leaders of both of the country's major credit score model developers — FICO and VantageScore Solutions — believe that lenders could reduce their credit score requirements with little risk.

In regions such as Tunney’s part of the San Francisco Bay Area, about 35% of the home sales are all cash. Homes for sale in Piedmont, including 6 King Avenue – offered at $4,950,000, require new mortgages. And, if people are unable to move up into such communities, there is a reduced market for first-time and moderate-income buyers.

Even though increasing the number of mortgages they make would stimulate home sales and job production, lenders are afraid to lower their credit score requirements, blaming Fannie Mae and Freddie Mac who buy or guarantee most of the conventional loan market. Because Fannie Mae, Freddie Mack, and other investors required lenders to repurchase billions of dollars worth of defective mortgages in the past, mortgage providers are extremely wary of underwriting anyone without pristine credit. Another property for sale in Piedmont is 87 Sea View Avenue, listed for $5,250,000.

On the other hand, Fannie Mae and Freddie Mac insist that they do not require a credit score anywhere close to 755. They do have a fee structure on the loans they purchase based on the credit score of the homeowner.

“Basically, it comes down to who is paying the most fees, lenders or homeowners,” remarked Tunney. While an abrupt opinion, there is likely some truth to it, given that the agency which oversees the two investors, the Federal Housing Finance Agency, is looking adjust the fees charged by Fannie and Freddie – including those based on credit score.

About Anian Tunney, Broker Associate

Anian Tunney is an agent broker with The Grubb Company. According to statistics collected by East Bay Regional Data, Inc., she was the 2013 number one real estate agent in Piedmont, CA for the number of units sold and sales volume. Additionally, Tunney is always in the top two in yearly real estate sales for The Grubb Company’s Piedmont, office. She is known for her knowledge, experience, and network in the Piedmont community—qualities which are invaluable for finding that special home or buyers for her clients.

A fifth generation Piedmont resident, Tunney has been with the Grubb Company for over 30 years. She raised her family of four in Piedmont and is active in community projects such as the Piedmont Beautification Foundation, the East Bay Museum Auxiliary, and the Piedmont school district. Her grandmother, Amy Sutton, was a real estate agent, and now Anian works with her daughter Adrienne Krumins, making Piedmont Realty truly a family vocation. Tunney negotiates with grace and clarity of purpose. She can be contacted at 510-339-0400 ext 217, and at tunney(at)grubbco(dot)com. Her website is aniantunney.com.

Contact Information

Anian Tunney
The Grubb Company Real Estate Brokers
Oakland, CA 94611
510-339-0400 ext 217

(1) http://www.latimes.com/business/realestate/la-fi-harney-20140803-story.html

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Suzanne Bourgault
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