What are banks now asking for for a mortgage?

What are banks now asking for for a mortgage

What are banks now asking for for a mortgage?

It is very common for those who decide to buy a house that they do not have the necessary money and have to resort to applying for a mortgage, as the cost of this type of purchase is one of the largest investments that can be made throughout life, especially the initial expenses. 


Until relatively recently, for a mortgage grant bank it was necessary to take out life and home insurance with the financial institution itself. Currently, customers can choose to obtain these policies, either directly with the bank or through an external insurance company


Before choosing one or another type of mortgage, it is recommended to inform yourself in advance of the various options available for the best financing. In the same way, it is also necessary to know in advance the requirements that the bank is likely to ask us to accept the loan to buy the house


Mortgage terms 

When granting a mortgage, one of the key points analyzed by banks is whether the user has a stable job, with an indefinite term contract, a certain period in the company and an acceptable salary. The latter must be high enough that mortgage payments do not exceed 30% or 40% of it, otherwise the financial institution will reject the loan. 

The funds we have saved are also a key aspect of the bank's credit approval. Since the funds currently provided by mortgages do not reach 100% of the cost of the house, it is necessary to have approximately 20% of the property price in addition to all expenses required by this type of transaction (valuation, notary, property registration, etc.). 

In some cases, the bank may consider that we do not meet the requirements for the mortgage and therefore may ask us to provide a guarantee as collateral in the event of a potential default. In such a case, it is necessary to conduct a detailed analysis of the risks they pose to the guarantor and its assets. 

In order for the bank to grant us a mortgage, it is extremely important to waive financial obligations, such as other personal loans, and obviously there is no outstanding debt in our name. 

Financial entities also require that the person applying for a mortgage must be under 75 years of age and be of legal age. 

Although each bank can request specific documents, as a general rule when applying for a mortgage, you must submit a DNI, updated business life document, recent income disclosure, latest banking transactions and other real estate bonds, if any, and proof of payment from other loans and income from other types of income in addition to salaries. 

Since the recent economic crisis, banks have usually analyzed everyone's profile as much as possible before granting a mortgage to minimize the risk posed by this indebtedness as much as possible. Therefore, if anyone interested in obtaining a mortgage does not meet the above requirements in addition to others that the bank may create, it will be difficult for them to obtain this type of banking product.