Banks significantly tightened real estate loan standards
Report underscores need to use an experienced and diverse mortgage broker

U.S. banks dramatically tightened their standards for approving individual real-estate loans in the first quarter of 2007, the Federal Reserve said Monday.

At least 38% of banks surveyed made it harder to get a mortgage loan, the Fed said in its quarterly senior loan officer survey. Fifty-six percent of banks toughened standards for getting a subprime loan, the Fed found, while 46% of banks raised standards for obtaining a nontraditional mortgage. Meanwhile, 15% of banks made it harder to get a prime mortgage loan.

The Fed also said 34% of banks surveyed also raised standards for getting a commercial real estate loan.