In order to buy a house, you need a mortgage. To get a mortgage, you need to be approved for a loan. That means having a lender look at your finances to determine whether or not you can manage the financial obligations of owning a home.
In part, that determination will be based on current lending standards. When standards are tighter, your finances will have to be in better shape to qualify for a loan. When they loosen, you have a better chance of being approved, even if your credit history isn't perfect.
The Mortgage Bankers Association keeps track of lending standards from month to month in an effort to measure how easy or difficult it is for prospective buyers to get approved for a mortgage. In June, their Credit Availability Index was relatively unchanged from the month before.
Joel Kan, MBA's associate vice president of economic and industry forecasting, says, these days, credit availability depends on the type of loan. “Credit availability was mixed by loan type, with the conventional index up 1.2 percent and the government index down 1.7 percent,” Kan said. “Although there was reduced supply of lower credit score, high LTV rate-term refinance programs, the decline was offset by increased offerings for conventional ARM and high balance loans.”
[Source]
