10/15/2020
Can you qualify for a Mortgage?
So, you can afford your desired mortgage payment but do you qualify?
There are a lot of factors that a lender considers when deciding to give you a mortgage. There's a difference between knowing you can afford a mortgage and being able to qualify for one.
FIVE MAIN FACTORS
1. CAPACITY
Can you repay the mortgage loan? This factor is the most crucial of the five. A lender will look at your credit report and review your debts to see if you've paid them on time. Lenders don't like to see missed payments consistently, which sends a message that you may be over your head with your debt load. Lenders also don't want to see too much debt or maxed out credits.
2. CAPITAL
This capital is the amount of money you have to invest in the property yourself. Lenders don't like to take all the risk. So, make sure you have at least the minimum down payment. That down payment can come as a gift from a family member, a retirement savings plan or it can come from a bank loan or a line of credit as long as you can manage the extra debt.
3.CHARACTER
Okay, this is a grey area: it's an impression of your trustworthiness. It's the big picture. Lenders look at how long you've been employed and how secure you are. They will also look at your ability to save and manage credit.
4. COLLATERAL
Yes, your cash flow is important but so is the property you're buying. the house is pledged as security for the loan. Collateral can also come from a third party who will guarantee the loan.
5. CREDIT
This is your credit history- how long have you been using credit. The more years you've bee an active credit user, the better.
Don't hesitate to contact Cole today to claim your free consultation for all your mortgage needs.
📩 [email protected] - ☎ 514-894-2653
