Do you need help getting approval for a mortgage? Do you have difficulty making your second home loan profitable? If you already have property or if your friends or family have property, then you must consider the pledges. The average consumer does not even know that he can use multiple pledges to increase his chances of getting a mortgage. However, it is a tool frequently used by creditors.
How does it work?
A collateral works in a similar way to a normal mortgage . You will simply have to provide several proofs of guarantees. Usually, debtors who are looking for this type of loan are:
- A person who owns several properties
- A person whose friends or family members agree to put their property under warranty to allow the debtor to obtain the mortgage
If your friend / family member puts his home under warranty so that you get a mortgage, both of you will have to go through some process (for example, the creditor will check your credit score and whoever is helping you) . Once the mortgage is granted, both of you become solidary debtors, that is, both of you are responsible for the entire debt.
Who can benefit from this tool?
Anyone can benefit from the mortgage. Among these people:
- Citizens who lack capital but are rich in equity
- People who want to get a mortgage but whose financial situation is more precarious.
- People who have already repaid or almost paid back their mortgage and want the value of their home to get money for other projects.
- People who want to improve their financial situation or repay debts with high interest rates.
- People looking for funds to do construction work, etc.
Collateral mortgages are not just for people with limited access to credit. This tool is available to any debtor looking for funding who can not obtain it elsewhere for unknown reasons. This type of loan easily adapts to the needs of customers.
Who are the creditors who accept the pledges?
Generally, you are more likely to be approved for a collateral mortgage with a private creditor than with a regular creditor such as a bank. The requirements of traditional creditors are a little harsher, though, sometimes, they accept collateral mortgages. However, private creditors are more inclined to find alternatives to meet people’s needs. In short, private creditors are more flexible than official institutions.
frequently asked Questions
Can my family members co-sign my mortgage?
Yes. Creditors can accept the signature of a guarantor if the guarantor is in good financial health. However, guarantors who sign for an at-risk debtor may be required to make a deposit.
Can a friend co-sign my mortgage?
Yes. However, as mentioned above, if the creditor decides that you are an at-risk debtor, your friend will have to make a deposit.
Can a family member or friend co-sign without making a deposit?
Yes, but mortgages are approved on a case-by-case basis. It depends entirely on your financial situation and the financial situation of your friend. You will have to discuss this with your creditor.
Need more information
If a collateral mortgage is something that interests you, look at the online application process that is being offered and ask for a call from our specialists.