Mortgage Lending: The Basics of a Healthy Financial Picture

A mortgage is the entryway for most people who want to buy their own home. Potential buyers should understand the factors that paint your financial picture for a lender when you apply for a mortgage. Lenders want to see potential buyer who has a strong credit record and proven ability to repay a mortgage loan.

Lenders consider these requirements when reviewing the financial worthiness of a mortgage applicant: 

1. Credit – A credit score of 720 or higher is optimal for a mortgage. A buyer’s credit score affects the type and amount of mortgage.

2. Employment – A strong history of employment, including being with the same employer for at least two years and in the same field of work for two years or more, shows a buyer’s stability and ability to pay a mortgage.

3. Down Payment – Having a sizable down payment means instant equity in a new home and proves financial responsibility. With a strong credit score, the buyer will be able to have a smaller down payment. Likewise, expect a bigger down payment with a weaker credit score


Mortgage interest rates are at record lows, making loans less expensive in the long run. Housing prices are also in the lowest range in recent history. The combination of the two factors makes for one of the most attractive real estate markets in decades for buyers. Fixed 30-year mortgage rates are averaging around 4.5 percent at historic lows and mortgage application activity in June had its highest gain since March, according to the Mortgage Bankers Association.


Mortgage lending is easing up from two years ago yet the overall real estate market is still unknown, according to Jay Skwierawski, vice president of Shelter Mortgage’s Elmwood, Illinois branch. Skwierawski also adds that the economic landscape has changed mortgage options. For example, once-popular but risky adjustable-rate mortgages are scarce.


Lower housing prices coupled with low interest rates makes for one of the best scenarios in years for buyers. Partnering with a mortgage provider than can guide you through the complex process can make the home buying process that much easier.


Shelter Mortgage is a an operating wholly owned subsidiary of Milwaukee-based Guaranty Bank, which has provided mortgage loans to thousands of families since 1923. Shelter Mortgage partners with real estate companies, builder’s community banks and relocation companies to offer mortgage financing as part of their businesses. The partnerships allow them to offer a convenient one-stop experience for both home buying and home financing nationwide.  





 Subject to change without notification. Information provided should not be considered as a commitment to lend. Offer subject to property and credit approval. Program and other restrictions may apply. Please contact your Loan Consultant for further details. ©2011 Shelter Mortgage

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