Before granting you a mortgage, a lender will determine whether or not you can afford the loan amount you’ve requested. There are a number of factors that the lender will use to determine your maximum affordability, including your annual income and debt obligations, your utility and living costs, as well as your chosen amortization period and mortgage rate. [...]
1. Too Much Debt Too much debt is a red flag to lenders that you may not be able to handle credit responsibly. The biggest problem with debt is how it effects your overall debt servicing. Lenders will look at what debt you carry and what percentage of income it takes to cover this debt. Debt servicing ratios [...]
With today’s “stress test”, and tougher mortgage qualification rules, many borrowers are requiring the help of a co-signer on their mortgage. But many people don’t really know what that means. A co-signer essentially becomes a “co-borrower” on your mortgage, and they’re as legally responsible for making payments as you are. You’re using their income & credit [...]
