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aj485,

You wrote, However, even under the old process, if, for instance, the purchaser got laid off the day before the closing, the bank would not lend the money, even if they hadn't specified 'the purchaser must remain employed' in their 'commitment' letter, because that condition was contained somewhere else in the fine print of qualifying for the loan, and the 'commitment' letter generally had some generic statement about 'all other conditions of the loan must be satisfied'.

One more minor point (and one that might not have applied to new purchases):

Prior to the credit crisis, you could get low or no-doc loans. I did a refinance in '03 or '04 that was considered an Alt-A loan. My broker did it that way because he could get me just as good a rate with minimal documentation as going full-doc. I'm fairly sure the lender didn't ask if I was currently employed. Mostly it was based on my credit report. I provided a few PDFs of my bank & investment account statements and my most recent tax return as back-up for my broker. Not sure how much of that the lender actually requested.

The point being that requirements to qualify for a loan in years past have been much lighter at times. We've just come through a period where loan requirements were overly strict in response to the mess overly loose lending made of the credit markets. If you haven't been paying close attention to the mortgage markets - and I know you have - your expectations might vary a lot depending on when you last applied.

- Joel
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