The 3 C's of Mortgage lending

From an earlier post this week. The 3 "C's" of lending why it is important to have a Mortgage Originator take you through the process. Credit: An acceptable credit reputation is established by a history that, when viewed as a whole, evidences a borrower’s willingness to make timely payments on obligations. Capacity: The borrower must have the ability to repay the mortgage in the amount and terms stated. Adequate capacity is established by documenting stable monthly income and/or assets along with other information about how the borrower paid obligations in the past that, when viewed as a whole, evidences a borrower’s ability to make periodic payments approximating the amount of the proposed monthly debt payment. Regardless of the level of the borrower’s previous monthly payments, the file must contain evidence of the borrower’s ability to meet all new obligations after the new mortgage is made. When the borrower’s obligations will increase significantly with the mortgage, the Brokers Transmittal Summary must contain an explanation as to how the borrower will meet the higher payment. Collateral: The collateral must meet minimum property requirements as specified herein. Each property must also have an established value to support the loan transaction. This value will help in determining the risk associated with the loan transaction. Just Saying Mr. Will