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Historically lenders would lend over collateral, with your net assets being an indicator of your ability to pay them back.
by RobLach 8y ago
Historically lenders would lend over collateral, with your net assets being an indicator of your ability to pay them back.
- Spooky23 8y agoNow lenders almost have a hybrid model -- they use the credit scoring to allow them to write the loan well over the recoverable value of the asset. When I was buying my new house, I found a lender who was willing to write me an interest-only, 105% LTV loan for the new house while I simultaneously had a mortgage on the old property. The premium was only like 1.5%, and I re-financed in a few months after the house sold.