Know the 5 C’s of a mortgage - before you plan your move.

  

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Credit, Character, Cash, Collateral…Your Loan Officer
will gather specific details about you for the purpose
of establishing your credit worthiness and an acceptable property for a mortgage.

Your credit is even more important these days. Your Loan Officer will check three FICO scores, one from each of the national credit bureaus. We use the middle of the three scores for qualifying purposes for loan programs.  Your credit record or credit score, and character, show us the commitment you have demonstrated to use credit wisely, pay debts responsibly, and consider the amount of credit used and your ability to repay.

Credit scores give lenders a fast, objective measurement of your credit risk. A loan decision can be made instantaneously, helping lenders speed up loan approval. The credit decision, using your credit score, allows lenders to focus only on the facts related to credit risk and not their personal feelings. Factors like your gender, race, religion, nationality and marital status are not considered by credit scoring. Many lenders offer a choice of credit products geared to different credit risk levels. Knowing and improving your score can lead to more favorable interest rates and significant savings over the life of your loan.

Cash represents the income used to qualify you for the loan repayment and the amount of money you have available to use as a down payment. We document your income with 2 recent W2’s and 30 days of paystubs, to establish a two year history of employment. Program guidelines dictate the amount of down payment required and we review the sources of those assets; checking and savings accounts, a gift from a family member, or a loan against a 401K to name a few.

The property you are buying is the collateral, and your purchase price and a current market appraisal, show the lender that the property is structurally acceptable and the value is current to the marketplace. Some property types are more difficult to finance, such as condos, based on the fiscal health of the association managing the units. Mobile homes, manufactured housing and seasonal properties are not allowed.

Let me be your final C when you need a mortgage.

-Corinne Chartrand, Senior Loan Officer, Mortgage Master Inc. cchartrand@mortgagemasterinc.com