When Wall Street crumbled last month, it has made it almost impossible for homebuyers - even the supposedly qualified ones – to get approved for mortgages.

According to the National Association of Mortgage Brokers, the reason for this is simple. Lenders are making sure that you satisfy all their guidelines. For instance, if you have made a single late payment on your existing mortgages, you will be denied for a second loan. This is even if you have high credit score and substantial assets and income.

Some home buyers are turned down because of their slightly higher-than-average debt to income ratio. Again, even if they have credit scores in the mid -700s and can come up with the 20 percent required deposit; chances are the lenders will still not approve the mortgage application.

Unfortunately, the currently-high interest rates have also made sure that most of the applicants will have a higher debt-to-income ratio. Indeed, it looks like a lose-lose situation for interested home buyers.

To make matters worse, lenders are discounting the property’s appraised market value because they are assuming that home prices will continue to fall in the coming months. This will certainly increase the loan-to-value ratio, which could once again be the reason for the lenders’ disapproval of the loan.

If you look at what is happening in the lending industry, it would seem like nothing is making sense. For most experts and analyst, it remains to be a guessing game. Until the market corrects itself, there will still be a lot of inconveniences for both lenders and borrowers.

With the financial industry suffering from major losses in the last weeks due to the collapse in Wall Street, more homes are expected to enter some stage of foreclosure. By the end of the year, the number of foreclosure homes is estimated to reach over a million

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