U.S. Crunch Turns Back Clock on Mortgage Lending

The New York Times reports:

As U.S. banks mop up the mess from billions of dollars of bad home loans, buyers are finding the days of cheap money are over and, in many cases, tougher versions of old lending rules now apply.

People of modest means have seen the American dream of home ownership move further out of reach. Even affluent buyers, who took advantage the last decade's low interest rates and looser lending standards to move up to more expensive homes or to buy investment properties, are seeing their options evaporate.

Gone are the days when almost anyone could get a loan with a down payment of less than the traditional 20 percent.

"The clock is rolled back about 20 years," said Lou Barnes, co-owner of Colorado-based Boulder West Financial Services and publisher of Mortgage Credit News.