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The Five 'C's' of Credit
 October 19 2016     Posted by Tina Meraw

The Five “C's' of Credit

Going to a lender to ask for a mortgage can be a nerve-wracking experience when you’re not sure what to expect. Before you go looking for credit, take a few minutes to understand what lenders are looking for: the five “C”s of credit.

How might you stack up in a lender’s analysis of the five C’s of credit?

Capacity: Be prepared to show a lender that you can afford your payments. The lender will look at your income from all sources, and compare that with your monthly financial obligations.

Capital: Your downpayment demonstrates that you can save and accumulate assets, and that you are more likely to do all you can to keep up with your mortgage payments.

Collateral: This is the lender’s assurance that the mortgaged property is marketable and can be re-sold to recover the investment.

Credit: Your habits in meeting your debt obligations will be evaluated.  Do you consistently pay your debts on time?

Character: Are you sufficiently trustworthy to meet your obligations? Your education and work experience will be factors, along with length of time at your current residence and job.

Good communication is essential to credit success. You want the lender to see that you and your business are a good investment.  Let us show you how!

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