Sunday, 27 July 2014

Mortgage, a form of employment

When analyzing a loan application, a person earning $ 10,000 may be perceived by banks as a customer less secure - trusted by people reaching monthly income of 1,200 dollars. This form of employment relationship determined by the potential borrower.

Bank, and analyzing credit applications, focusing of course on the amount of the monthly salary, the number of people in the household, whether the credit history and current liabilities. In assessing the credit worthiness but also take into account the form of employment potential borrower.

The greatest trust among banks enjoy a person employed under a contract of employment for an indefinite period. This form of employment is considered to be the safest, because it is a way for banks guarantor of long-term employment. This in turn is associated with the receipt of remuneration in the long term, and thus the ability to timely payment of loan installments. It should be noted that a mortgage can also apply for a person whose employment contract does not have a character with respect to time indefinite employment. Depending on the institution, just a few months' seniority with the employer, by obtaining a loan there were no major problems. Banks usually require in such cases the length of the above three or six months.

Other forms of employment

Obtaining income under contracts of order, or the work does not disqualify a potential borrower. Similarly, the situation is for people running their own business. So earning borrowers, however, are nevertheless treated less favorably by the banks.

Potential borrowers employed on the basis of the so-called agreement "junk", ie of the order or contract work, must demonstrate above all the continuity of employment. Banks therefore define a minimum period of earning an income from this source. Depending on the institution, this period ranges from six months to even two years. based on the analysis of financial data banks tested in this way, the regularity of runoff salary and of course its height.

Even less trust are gifts from people running their own business. One to apply for mortgage lending, they boast an annual or even a three-year business activity. In their case, on a slightly different basis is calculated as creditworthiness. At its calculation of "full-time" employee, the bank takes into account the average salary of the last three months, and for people running their own business, the average salary is mostly determined for the annual period, or even 24 months. Banks also take into account the ratio of revenue to costs generated by the trader. Best for such a borrower would be if every month he earned exactly the same - revenue in individual months can not deviate too much from the income calculated on an annual basis or two years.

As you can see self-reliance does not always pay off. It is noted, however, that in recent months is no small improvement seen credit offer dedicated and self-employed persons receiving revenue under contracts with the order or work. Still, earning more, have lower capacity as compared to the credit "etatowcami".

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