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Two Key Factors
In Qualifying For A Loan

In attempting to approve home buyers for the type and amount of mortgage they want, lenders basically look at two key factors: the borrower’s ability and willingness to repay the loan.

Ability to repay the mortgage is verified by your current employment and total income. Generally speaking, lenders prefer for you to have been employed at the same place for at least two years, or at least to have been in the same line of work for a few years. The borrower’s willingness to repay is determined by examining how the property will be used. For instance, will you be living there or renting it to a tenant? Willingness also is closely related to how you have fulfilled previous financial commitments, thus the emphasis on the credit report or rent and utility bills.

It is important to remember that there are no rules carved in stone. Each application is taken on a case-by-case basis. So even if you come up a little short in one area, perhaps one of your stronger points will make up for the weak one. Everyone involved in real estate is in the business of selling homes, in one way or another. Therefore, if the loan makes sense, lenders and insurers will do their best to see that you qualify.

By its very nature, mortgage insurance is an aid to affordability because it allows families to buy homes with less cash on hand. The industry plays a central role in helping low- to moderate-income families become homeowners. Borrowers are taking advantage of low down payment mortgages and becoming homeowners with less than 20 percent down. For more information about how you can take advantage of the benefits of a low down payment home loan with mortgage insurance, contact eastcap mortgage.