Mortgage House Looks at Loan Size Considerations for Special Cases
Mortgage House provides pre-tax considerations, niche solutions, and super-low interest rates. During the application evaluation process, our loan specialists take into account loan size considerations.
Our loan team and proprietary tools apply several lenders’ ratios including buffering. When we decide on the best loan size to issue, we put the applicant’s finances through a stress test.
In October 2021, the Australian Prudential Regulation Authority raised the buffering percentage from 2.5% to 3%. Lenders come up with loan terms for each applicant. Next, they place the applicant’s finances through a hypothetical situation. They raise the potential home loan rates and raise them 3%. If the client’s finances can handle the increase in rates, they are one step closer to qualifying for their loan.
When the applicant’s finances cannot, it’s possible to adjust the loan size. The Australian government favors individuals becoming homeowners instead of remaining renters for long time. Once an individual becomes a homeowner, they start building wealth, even if it means delaying purchasing their dream home for a starter home.
Investors find themselves on a different spectrum. They borrow amounts that go up to the $1 million mark. Mortgage House works with investors too. Our loan specialists find suitable loan terms for the client and our lending institution.
Loan Size Considerations Conclusion
Mortgage House assesses loan size considerations when evaluating applications. As a non-bank lender, we can fund loans that banks consider high-risk. However, we also set up our clients to succeed financially. Contact our loan specialists to obtain more information.