A mortgage is a loan secured by an asset, real estate in general.
Mortgage loans are used by property buyers to purchase real estate. Property owners can also take out a mortgage on their property to buy another piece of real estate or refinance an existing mortgage.
When you take out a mortgage, the lender of that loan takes priority over any other credit institution or lending organization to whom you have debt obligations. If you fail on your payments because you have become insolvent or go bankrupt, your mortgage will be paid first. After full repayment, other lenders will be paid.
With the property purchased put up as collateral, lenders hold a secured debt. A secured debt increases your chances of getting a loan.
Features of mortgage loans such as amount, duration, interest rate, repayment method, etc., can vary considerably from one to another. It’s important to choose your lender wisely, since mortgage loans are often for 10 or 20 years, and the impact of the cost of the loan can be significant.
A good way to get a lower rate on your mortgage loan is to improve your loan-to-value ratio (LTV). The LTV is the ratio of the loan to the value of the property.
For a $100,000 property, if you are requesting a loan of $80,000, the LTV will be 0,8 or 80%.
Because the LTV is high, the lender is taking more risk and your mortgage interest rate will be higher too.
Try to bring some cash into the financing options for your property, that way the LTV of your mortgage loan will be lower, and your mortgage interest rate too!
Comparelend helps you find the best lender for you, by letting you compare the various offers, rates and fees. With Comparelend, you can save money while choosing the best offer for your mortgage loan.
Am I eligible for a mortgage loan?
To be eligible for a mortgage you will need to match certain criteria:
> Be a US citizen or permanent resident
> Be 18 years or older
> Have a good credit score
Because of the length of mortgage loans, credit companies make an analysis of your credit history and credit score before giving you an answer. With your permission, your lender will run your credit report as part of the process.
Checking your eligibility for a mortgage loan will not affect your credit score.
You'll need to provide the following document to get a mortgage loan:
> Social Security Number
> Proof of income (for example, most recent payslips and W2s)
> Recent payslips (the two most recent consecutive payslips)
> Bank statements for all financial accounts, including investments (for the last 2 months, all pages)
> Signed personal and business tax returns (all pages and relevant schedules)
> If self-employed, a copy of your most recent quarterly or year-to-date profit/loss statement
> A copy of the signed Purchase and Sales Agreement
The lender may request more documents, depending on your profile and the type of mortgage you are applying for.
Getting a mortgage loan with banks can be really difficult and long. Getting an appointment with your advisor to ask for the loan can take days. The whole process before getting your money is generally between 15 to 30 days.
With Online lenders, it’s easier and faster to make your mortgage loan request and get your mortgage interest rate. You can make your request from home at any time, any day, upload all the required documents and get an answer in 24 to 48 hours. It generally takes just 5 to 10 days to complete your mortgage loan application and get the funds.
If you own a small business, you probably know how complicated it is to get a business loan through traditional circuits. Through peer to peer lending however, some barrier to entry are suppressed. First of all, the requirements are lower investors being open to risk taking, and so securing a loan is easier, faster and cheaper. The process being entirely on line and very user friendly, it takes not more than 20 minutes to register on the platform, approximatively 48 hours to get accepted, and up to 3 weeks to receive the money. The interest rates are lower and usually no hidden fees added. Moreover, the online investors are welcoming for new borrowers as they are rather eager to support business owners, often locally.
CompareLend.com offers business owners a free, unbiased and immediate access to investors on peer-to-peer platforms. It helps business owners to choose the best financing opportunity from what the market has to offer. Getting financed is then easier, cheaper and faster.