UNDERSTANDING THE MIND OF A LENDER:
Have you ever been approved for a mortgage? More importantly, have you ever been declined? Do you know why you were approved or declined? Or maybe you are brand new to the whole process...
This is a post to a series that explores a lender’s decision making process that ultimately leads to your mortgage being approved or declined.
Actually, borrowing money for a mortgage in Canada is becoming increasingly difficult. Over the last 5 years, the government has tightened up lending guidelines and lenders seem to be looking at every mortgage application with a magnifying glass.
Every lender has their own level of risk tolerance when assessing a mortgage application, however, there are four main areas common to every lender for their assessment. We will outline them for you in following posts. The areas are:
As plainly as we can put it, the biggest problem you will face in applying for a mortgage is the disconnect between your belief that you are credit-income-asset-worthy to borrow money, in your own mind minimizing your flaws, compared to the lender’s scrutiny of your income-credit-asset worthiness, seemingly making a huge deal out of insignificant issues.
Now, let me do a quick plug for working with a mortgage broker. When you go into the bank, the banker has the bank’s best interest in mind, they work for the bank, paid by the bank, to limit the risk to the bank while making money for the bank. In no way do they work or represent you.
On the other hand, when you work with us, we work for you, with your best interest in mind. We present your application to a lender or several lenders in a way that highlights your strengths and explains any shortcomings. We use our knowledge, experience and relationships to advocate on your behalf making sure to put forward a clear and concise mortgage application ensuring the best chance for an approval. As an added bonus, our services are free to you.
If you would like to sit down and discuss applying for a mortgage, please feel free to contact us anytime! We would love to talk with you.