Tag Archives: loans

Homeownership Can Boost Your Approval Rate

Regardless of the loan type you are applying for, you can get a boost on your approval rate if you are a homeowner. Homeowners have better chances of getting approved for home loans, home equity loans but also for unsecured personal loans, student loans, car loans, business loans and many other loan types.

The reasons for this can be explained analyzing the effects that homeownership has on the loan terms and requirements for approval. There is a variable that is greatly modified by homeownership which has important incidences on all loan terms and requirements: the risk of default for the lender in the financial transaction.

Risk Of Default And Approval

The approval process is ruled by the lenders fear of default: The higher the risk of default, the lower the chances of getting approved. In the event of default, the lender is actually loosing his investment because there are little chances of recovering the money unless the lender has sufficient assets to compensate for the loses.

The risk of default and approval are thus, greatly related. If the applicant can provide any aid to reduce the risk of default, the lender will be significantly more comfortable at lending the money that the borrower needs. Thus, it is important to know which modifiers can reduce the risk of default and boost the chances of getting approved.

Consequences of Homeownership

Along these modifiers we can analyze various options: collateral, simple homeownership, down payments and a co-signer. Collateral provides the best form of guarantee as it is a particular asset that is used for security of a loan and the lender can take legal action of repossession in the event that the borrower defaults on the loan.

A down payment is useful for certain secured loans that already have collateral but the risk of default is still high. Then, the borrower offers a certain amount of money that has already been set aside by him, so as to reduce the amount of money needed to purchase the home or the car and thus, leaving the property with a higher amount of equity left. The property guaranteeing the loan is then worth more than the debt it is guaranteeing.

A co-signer is obliged to repay the loan along with the main applicant and thus provides an additional guarantee for repayment. This is also associated with homeownership. If both the applicant and the co-signer are homeowners, chances of getting approved are greater as the lender has additional properties to obtain repayment from in the event of default.

Finally, we have reached the modifier that can provide a great risk reduction without too many hassles. Simple homeownership provides a reduction on the risk involved in any financial transaction regardless if the property or properties are used as collateral for the loan. This is due to the fact that all of the applicant’s assets guarantee in a way the repayment of the loan. All the assets legally guarantee any debt that the owner may have and that’s the reason why a co-signer who is also a homeowner provides an additional guarantee and lowers the risk even more: He does not only provide an additional income but also, an additional real estate guarantee or guarantees.

Online Mortgage Brokers

Applying for a Home Mortgage Loan through Online Mortgage Brokers

Very often home buyers get finally stuck when it comes to applying for a home mortgage loan. Inspite of their efforts to find the right kind of loan program, their lack of knowledge and information about the home mortgage products available in the market they are either stuck some where or end up opting for a bad scheme. The role of online mortgage brokers begins when the home buyer is either completely confused and just does not know how to proceed.

Home Mortgage Loan through Online Mortgage Brokers

Online mortgage brokers ease through the process of applying for a home mortgage loan. Say you are a borrower willing to purchase a house, irrespective of the credit score and the amount of loan required for the purchase of the house, the mortgage broker is in a position to arrange for the fund, choosing amongst the various loan options available in the market.

Finding Mortgage Brokers Online

Mortgage brokers especially online brokers reduce your efforts by offering services online. With just a click of a button you get the details of home loan options available and the one most suited to your requirements. Like any other brokerage firm, these online mortgage brokers have what is called the pre screened set of money lenders for such mortgage loans and it makes their job easier to choose an option among the ones offered.

As intermediaries they help both the lenders and the borrowers to strike a win-win deal. No more running from one office to the other, you can do the entire search by peacefully sitting before your computer.

Basis of applying for Home Mortgage Loan – What you should remember…

Applying for home mortgage loan through online mortgage brokers involves submitting an application form requesting for a home mortgage loan. In no time you are sure to get the response from the service provider offering you the list of plans suitable for your requirement. Are you not comfortable with your credit score? Online Mortgage Brokers find a suitable loan option that can lend you the funds. No matter the nature of loans online brokers bring the list of loan options before you for you to decide upon.

Being licensed individuals or companies these online mortgage brokers, they get you the best options at the best possible rates. Analyzing the four important aspects of loan grant namely credibility, income, savings and reserves and loan to value, these online mortgage lenders get the most needed of services for the best choice of loans.