Question
I have a very bad credit rating but a very good income. I’m working on improving my credit rating (takes time), but need to take a mortgage now, as I have big family and my rent is around £1200, which is a waste of money. Preliminary I did qualify for a sub-prime mortgage (around 8%), with the minimum deposit of 25%; how much equity in % will I have from start?
I have a very bad credit rating but a very good income. I’m working on improving my credit rating (takes time), but need to take a mortgage now, as I have big family and my rent is around £1200, which is a waste of money. Preliminary I did qualify for a sub-prime mortgage (around 8%), with the minimum deposit of 25%; how much equity in % will I have from start?
Answer
if a property you buy is worth x dollars and u put down 25% then you have 25% equity. normally bank wont lend to u if the appraisal doesn't come out to the value of purchase price. The lender want to protect themselves so they will make sure the value is there before lending the money. Now if you got a great deal and appraisal came out high on property you could potentially have a greater then 25% equity position. Most likely bank will still want your 25% as they call it your skin in the game!
if a property you buy is worth x dollars and u put down 25% then you have 25% equity. normally bank wont lend to u if the appraisal doesn't come out to the value of purchase price. The lender want to protect themselves so they will make sure the value is there before lending the money. Now if you got a great deal and appraisal came out high on property you could potentially have a greater then 25% equity position. Most likely bank will still want your 25% as they call it your skin in the game!
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