The economic crisis affects all areas of human activity. It also has a negative impact on the financial sector, as a result of which the lending sector suffers immediately. All banks have revised their policies and decided to significantly tighten the requirements for borrowers, especially when they want to borrow a very large amount of money from the bank. At the same time, we should not forget that the population’s ability to pay has decreased, and now people are wondering: “How to take out a mortgage with a small income?”.
A mortgage with a co-borrower
Today, it is very difficult to pay mortgage loans on your own, because the amount of mandatory payment is often measured in the tens of thousands. A person with a small salary may not be given such a loan if he takes more than half of the monthly income. It will be easier for family people here, since a spouse, if they have a permanent official income, can be issued as a co-mortgagee on a mortgage loan.
In this case, all calculations will be made by the lender based on the total monthly income. Single borrowers can also use the help of a co-borrower. In this case, you can use one of your parents or other close relatives as an assistant. It is important to correctly calculate your ability to pay off the loan, because, with such a mortgage, the person who agreed to become a co-borrower will also suffer from delinquencies.
Often people do not live on just one salary; many are looking for part-time work. When applying to a bank for a mortgage, a person with a small official salary should be told about the availability of part-time work or other sources of additional income.
It is advisable to try to provide your words with documentary evidence. For example, if a person receives additional income from renting out real estate, then such a document can be a lease agreement. Some banks may have enough bank statements for several months, which can be used to track the amount of additional monthly income.
Attracting a guarantor
It is important not to confuse the concepts of co-borrower and guarantor. The co-borrower shares duties and rights with the main borrower. The guarantor just becomes a guarantee that the borrower will pay off their mortgage debt. The bank asks the guarantor to make a payment only when the borrower has serious delays. This should always be remembered by the person who is going to take out a loan.
If he has doubts about the ability to repay the mortgage debt in full within the established time frame, then it is better to refuse to involve guarantors, since, in the event of problems, the relationship with the guarantor is likely to deteriorate. And it will be especially unpleasant when the guarantor was a relative or close friend.
Before applying to the bank, a person can independently calculate whether their salary allows them to get a mortgage loan of a certain size. This is done using special calculators that are present on the website of every serious bank. Such calculations will help you understand what method to increase the chances of resorting to and whether it is worth taking on the burden of a mortgage loan at all.