Although mortgage underwriting standards were much too loose during the “go-go” years of 2004 to 2007, the pendulum on credit standards has swung too far the other way, according to a new report from Amherst Securities Group.

“Subsequently, guarantors and originators seem to have overacted,” wrote a team of Amherst analysts lead by Laurie Goodman.

Goodman noted that FICO scores — a key measure of credit availability — rose to 747 in 2011, compared to 698 in 2006.

In particular, Amherst is talking about Fannie Mae and Freddie Mac loans, which today fund about 70% of all new originations.

Amherst notes that lending standards in Federal Housing Administration/Veterans Affairs programs have remained “roughly constant” with more activity gravitating toward the two programs.

During the height of the subprime boom, GNMA-related loans accounted for just 3% of all residential lending, according to figures compiled by National Mortgage News.

Goodman warned that it’s “increasingly difficult for borrowers who are ‘outside the credit box’ to qualify for a mortgage.” She lamented all this is happening at a time when housing affordability “is at a generational high.”

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