Tight loan conditions restrain home sales

Officials from the National Association of Realtors have found that existing-home sales slipped from August to September, as many potential buyers continued to run into loan problems.

The group says the seasonally adjusted annual rate of existing-home sales slipped 3 percent from August to September to 4.91 million. While that's an improvement from 2010, NAR said it's below expectations given the current situation.

"The irony is affordability conditions have improved to historic highs and more creditworthy borrowers are trying to purchase homes, but the share of contract failures is double the level of September 2010," said Lawrence Yun, NAR chief economist.

The group says that nearly 20 percent of its members said that they experienced a contract cancellation last month, compared to just 9 percent a year ago.

The tighter lending rules in place at many mortgage lenders made it even more important that those looking to buy a home review their credit reports for any typographical errors or other mistakes. Those marks could negatively affect a potential borrower's credit score.