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When the federal government bailed out the banks a year ago it was with the expectation that taxpayer money would be recycled back into the economy in the form of more loans. We all know how that didn’t play out according to Washington’s plans. But now that the recession has been unofficially deemed over and the economy seems to have stepped back at least a few feet from the financial-crisis cliff, are lenders following the script (finally) and opening the spigot?

Not exactly. The latest Federal Reserve survey of senior bank loan officers in October finds mortgage lenders are still plenty grumpy. Just 3.6% of lenders reported they had they had eased their mortgage qualifying standards “somewhat” over the past three months. But that was more than wiped out by the 25% who said they had tightened their standards. That said, the 25% who recently tightened are well below the record 75% who reported tightening in July 2008. But what we’re not seeing is any meaningful easing.

Surprisingly, half the banks say they reduced existing home equity lines of credit in the most recent three-month stretch. We're this far into the real estate correction and they still haven’t finished with cutting their HELOCs? Apparently banks aren’t convinced the slide in home values is anywhere near over. Or they have re-run their models and worry that that persistently high unemployment will push the delinquency rate on home-backed loans higher. Or the lenders are reacting to problems elsewhere in their business (see: commercial real estate) and are looking for any opportunity to reduce their risk exposure. Or all of the above.

The bottom line is that the only way to take advantage of today’s historically low mortgage rates -- the 30-year fixed-rate is at a rock bottom 5% -- is to hurdle high lending standards. The fastest and surest path to a new conventional mortgage at a rock-bottom rate is to come to the table with a 20 percent down payment, unless you plan on going the FHA-insured route. But that too looks like it is in for some much needed tightening. As Beth Braverman reported last week, the FHA is finally lurching toward the realization that higher-risk borrowers should have more skin in the game than today’s piddling 3.5 percent down payment requirement. (That said, raising the down payment requirement on FHA-insured loans to 5 percent doesn’t exactly sound like a whole lot of taxpayer protection given expectations that home values could fall another 10 percent or so before stabilizing.)

And beginning this week Fannie Mae is tightening its qualifying standards for automated loan approval: The minimum FICO credit score will rise from 580 to 620 (that’s still deep down in subprime territory), and the maximum total debt-to-income ratio will be capped at 45%, unless you have a really good reason why it should stretch to 50%. It’s as if Washington is catching up to lenders: Tightening loan requirements is still the way to go.

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