Do I qualify for a mortgage loan?
This is perhaps one of the first questions that will come to mind when applying for a home loan in Perth. Lenders don’t just loan a large sum of money to anybody. They want to make sure a borrower is responsible and capable of paying them back.
For you to be eligible to get a loan, you need to have the following:
- Sufficient monthly income
Monthly income is an important criteria for obtaining a loan. This is one of the first things that lenders check when determining the qualifications of a borrower. Lenders will your check your income and how much your mortgage will cost you every month. Your total monthly income will be compared to the total monthly housing costs. Borrowers must have a monthly income that is twice or thrice higher than the monthly mortgage payment.
- A stable job
To ensure there’s a good source of income, it is important for borrowers to have a steady employment. This is a prerequisite that makes a borrower eligible for a loan. You must have at least two years of stable employment in the same field or job. Seeing your steady employment can let a lender determine your ability to pay for your mortgage within a period of time.
- Low debt levels
Your current debt can significantly affect your ability to get a loan. Lenders will determine your debt-to-income ratio by comparing your monthly income to your total debts. This doesn’t only include your mortgage payment each month but other payments as well such as personal loans, car loans, child support, credit card payments, and bills. Expect that you’ll be requested to provide financial information.
- Good credit score
Yet another determining factor in qualifying for a loan, your credit score will be thoroughly checked by lenders. They may contact credit bureaus and request for your credit files. Knowing your credit history can help lenders identify whether you’re a high or low risk borrower. Lenders will also check if you’ve had late payments or maxed out credit cards.
A high credit score will make it easy for you to qualify for a mortgage. A low score may convince the lender to deny your application or give high interest rates.
Different lenders may have their own criteria for the pre-qualification process. What you can do is to contact them and ask questions so all your concerns will be addressed.
If you’re interested in learning more about loans, feel free to browse our page. We have a home loan calculator that can help you determine how much you can borrow. It’s easy to use!
Get in touch with us and let us help you make the loaning process easy. We are a reliable financial mortgage broker offering professional financial services.