I found this fascinating quote today:

The housing bust isn't just slashing home values and jamming the financial system, it's constricting the supply of mortgage credit as well. Although 30-year fixed mortgage rates remain attractive, banks are jacking up lending standards and inserting additional hurdles into the home loan process. As a result, some would-be borrowers will face higher rates, while others will be turned down altogether. But that doesn't mean you can't get a mortgage, says Keith Gumbinger, vice president of HSH Associates. "Mortgage money is available," Gumbinger says. "In order to have access to the financing, however, you are going to have to align yourself more closely with the new, more prudent lending standards." Amid higher delinquencies on home loans, banks have ditched many of the breezy credit practices that helped inflate the housing bubble. "The days of giving loans to anybody with a pulse are behind us," says Mike Larson, an analyst with Weiss Research.5 Tips on Getting a Mortgage in a Credit Crisis, Oct 2008

You should read the whole article.