Buying a home? Here's why it's in your best interests for lenders to consider you a low risk borrower.
If you’ve decided to become a homeowner, the first thing you need to do is find out whether you have a good chance of being approved for a home loan – or whether lenders will consider you too “high-risk”.
“It’s all very well to start looking at online listings or visiting show houses to find your dream home. But you first need to work out how much you can afford to spend, how you plan to finance your purchase, and then whether the banks will even consider you for a home loan,” says Shaun Rademeyer, CEO of BetterLife Home Loans, SA’s biggest mortgage originator.
“Lenders are always on the lookout for low-risk borrowers – that is, consumers with good credit records that show they have be diligent about repaying previous debts; consumers without a too much current debt that will make it difficult for them to afford another monthly instalment; and consumers who have a proven and regular source of income.
However, he says, even if you think lenders might consider you to be a “high-risk” now, it is not the end of the road for your home ownership plans. “You don’t have to resign yourself to being a tenant forever. Work with a reputable mortgage originator like BetterLife Home Loans that can advise you how to become a lower risk prospect, and will then prepare, motivate and manage your application in a way that ensures its best chance of success.
Rademeyer says some of the most important steps for potential borrowers to take before they apply for a home loan include the following:
Article from privateproperty