Mortgage Credit

Getting approved for a mortgage credit is important in successfully purchasing a house. Without this financing, you will not have the necessary resources to invest in real estate.

It is a long-term commitment, so we offer you five tips that will help you in this process. Are you ready to discover them? Let’s get started!

 1. Pre-approval of mortgage credit

Obtaining the pre-approval of a mortgage loan will give you the flexibility to search for a property according to your budget.

Some factors that financial institutions evaluate for the pre-approval of a mortgage loan are employment situation, income, credit score, down payment, among others. If you pass all this process, you will receive a pre-approval of the amount, term and interest rate of the loan requested.

2. Job stability

Having a stable job while evaluating mortgage loans is important to ensure approval. With this point in your favor, the banks will guarantee that you are in optimal conditions to pay for the loan. If you are working part-time or freelance, the ideal would be to get a full-time job. If you get the latter, you must have been working in the company for six months to a year to show that you are in a stable job.

3. Save for the down payment

You must have money saved for the down payment to apply for mortgage credit. Banks grant a loan of 80% to 90% of the property’s value, so you must pay the remaining amount.

You can open high interest savings account with CI Direct to start depositing the money saved for the down payment of your property. Saving your down payment on CDI Direct HSA will earn you 0.5% to achieve your goals

If you pay a higher down payment, you will have lower monthly payments. Ideally, you should have between 10% and 20% of the total value of the property.

4. Cancel outstanding debts

When making a loan application, banks evaluate your debt with other financial institutions to determine your credibility. Therefore, to obtain approval for mortgage credit, it is recommended that you get rid of your debt with other financial entities.

In addition, avoid generating new debt during the mortgage loan application process.

5. Financial behavior 

The banks will review all your debts in the financial system to see if you have a good payment history. If you have a poor credit rating, it is unlikely that you will get approval for a mortgage loan.

Conveniently, the sum of the monthly installments of your debts must be less than 35% to 40% of your income. Likewise, the total amount of your debt should not be greater than your equity (vehicles, properties, shares, among others).

 Remember to maintain good financial behavior since a positive rating in the Bureau will allow you to access a larger loan and .

In conclusion

Customer service is essential when deciding where to take mortgage credit. It is a long-term commitment, so you should choose a bank that gives you all the advice and support you need, and being able to quickly answer any questions you may have. Many mortgage brokers such as Breezeful and Homewise make the mortgage application process seamless. You can contact them and access the option you are willing to assume for the financing of your home.