A home loan is probably is the biggest ever loan for most people. It often amounts to hundreds of thousands of dollars. Not surprisingly, qualifying for a home loan doesn’t come easily. Before agreeing to lend $300,000 for a new home buyer, the mortgage lender needs proof that the borrower can keep up with mortgage repayment.
The following are some lending criteria set by mortgage lenders for their prospective borrowers.
Borrower’s Income is a Major Lending Criterion
Obviously, the best way to service a loan is to have regular income. Generally, that means having a permanent and steady job. The mortgage provider will often need to see the borrower’s employment history with the same employer for at least 12 months. When applying for a home loan, the three most recent pay slips, two years of tax returns and proof of continued employment from the current employer in writing will be required.
