Eligibility Criteria For A Mortgage Loan Approval

Several types of mortgage loans are being floated inpayments made towards rent, mortgages and credit
the market by multiple financial institutions. However, itcard bills.
is advisable to have information regarding variousAnother important criterion is the debt-to-income ratio
criteria that are taken into consideration by mortgageof the borrower that determines the eligibility and
lending firms while determining the eligibility of ainterest rate on the loan. Borrowers having a
borrower for a mortgage home loan. As these criteriadebt-to-income ratio of 28/36 are considered ideal for
determine the interest rate on the loan, knowledgea mortgage loan. However, certain lenders entertain
about them is even more vital.customers with a poor debt-to-income ratio. But, loans
The most important criterion that lenders usually go forto these customers are provided at a higher interest
is about the repayment capability of the borrower.rate and require a high down payment.
Credit history and FICO scores of the borrowerApart from these, the customer is expected to have a
provide ample information regarding financial statussteady income and a satisfactory employment record
and the repayment history of the borrower. Lendersso as to multiply his chances of getting a mortgage
usually give prime importance to borrowers having aloan approved. The customer must be employed with
reasonable credit history with credit scores of morea single employer for a minimum period of 2 years in
than 600. Credit reports of the borrower can beorder to be eligible for a loan.
obtained from any of the three leading credit bureausInterest rates on the loan also vary if the loans are
in the U.S.. Credit reports contain details such as thefederally insured or assured by any private mortgage
income of the borrower, his credits, and any lateinsurance companies.