Problems in mortgage lending go "well beyond subprime," and the tightening of loan underwriting standards now underway is likely to push demand for homes down 15 percent and depress prices by 5 percent this year. That's the rather gloomy forecast by analysts who follow the stocks of major home builders for Banc of America Securities LLC. In a report issued Tuesday, "Dissecting the Mortgage Distress," BAS analysts said there's already an excess supply of 800,000 existing homes on the market, and another 300,000 will soon be added to inventories through foreclosure. But the biggest problem facing housing markets may be the tightening of credit that's taking place as lenders put the brakes on risky loans including low-documentation and zero-down-payment mortgages, the report said. "We expect loans with a combination of low FICO scores and high (loan-to-value ratios) will end or tighten with many buyers choosing to remain as renters," wrote BAS analyst Daniel Oppenheim. BAS is a subsidia...
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