COVID 19 and Tightening lender requirements

[Brian Whelan]

Banks like JPMorgan Chase & Co. have begun the process of tightening their lending requirements in an effort to limit their exposure in the months ahead. Borrowers will now need 20% down-payment and a credit score of 700 to get approved for a new purchase. Most conventional lenders will likely follow suit with similar restrictions. The knock on effect surely will mean a smaller pool of residential buyers and a growing number of tenants in the market.

Will this drive rental demand for Multifamily owners? Will it create a compelling case for Developers to focus on rental building development in the short-medium term? Will there be more opportunities for hard money lenders and other non conventional types? Or will the falling employment numbers off-set any gains here?

Is there a silver lining in any of this?!