The Three C’s of Home Loans

In this video, iChoice principal Jason looks at the ideal home loan structure. One of the first issues we address is what bank will approve the kind of loan that you need. Jason talks about the three C's of lending.

  • Collateral.
  • Capacity.
  • Character.

First is collateral. What is your borrowing capacity? When considering collateral we look at the LVR required, and what the type of loan you require permit the LVR that you can afford. Second is capacity, and it's orientated around the banks determination and calculation of your ability to service a particular loan. The last consideration is character and it includes all the elements that aren't covered by collateral or capacity; savings record, tenure of employment, credit history, self employment, and so on.

Within just a few minutes of talking to a client we have a good understanding of what products might be best suited.