Qualifying for a Home Loan

As your trusted Ventura County Realtor our team is well versed in what it takes to qualify for a home loan. There are what are referred to as the four C’s of home loans. If this is your first home, we highly encourage you to sit down with a trusted loan professional to discuss your financials and real estate goals. We would be happy to review the process with you in detail as well so that you can prepare yourself for what to expect. See below for a greater explanation of the four C’s of mortgage qualifications.
1. Capacity to pay back the loan: Your mortgage lender will most certainly review your financial ability to pay back your loan. This will include your source of income(s) and the stability of said income. Your mortgage lender will also review all of your debts and how they compare to your level of income with a final debt to income ratio.
2. Capital: Depending on the type of mortgage you are qualifying for your mortgage lender may look at the various types of reserves you have in the form of savings accounts and even retirement accounts. Not all mortgages require reserves.
3. Collateral: Like any major loan your lender will likely look to collateral to secure the loan. In the case of your mortgage, the home you are purchasing will act as collateral. This is why your lender will order an appraisal, to ensure that your home is valued high enough to replace the loan.
4. Credit: Most home loans have a minimum credit requirement because it shows your likelihood of repaying back your loan based on your previous commitment to repaying debts.
As your local Ventura County Realtor and real estate team we hope to help you through the home loan process every step of the way. Please do not hesitate to ask any questions throughout the process.