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A Brief Guide to the Three C’s Of Lending

Real estate loans have become a thing very much in vogue these days, because of the rising desire of more and more people to become home owners. Any person who is earning, dreams of having his own abode at least once in their entire lifetime, for which they are ready to pay any amount that might be required, except that they will not be paying the amount all by themselves at one go.

This is where they take the help of mostly banks, or some other privately held financing institution like the Equity Bank headed by Steve Liefschultz, a former banker and an existing expert in the realm of real estate loans, to procure the money for buying their house. This company has been catering to a lot of upcoming businessman too who need financial support to make investments in their business.

Loan of any kind needs a lot of careful understanding and scrutiny before indulging into it. In fact many things are required by the lending company for them to ascertain that the particular customer qualifies for the loan receiving or not. In brief, there are three ‘Cs’ that are majorly important to decide upon the qualification of any applicant. They are Credit rating, Collateral and Capacity to repay.

C’s Of Lending

The mortgage loans too that are taken for the purpose of purchasing homes are subject to these three ‘Cs’ of lending. This kind of qualification analysis method was taken after the lenders faced problems of non-repayment of loans from low quality borrowers. The sub-prime mortgage loans and their ill effects were what led to this condition.

The situation is such that the U.S. economic conditions are greatly affected by this and thus most financial institutions have to go through stringent self-regulation measures. In fact, the U.S. is still under economic uncertainty because of the reason that the value of real estate has considerably declined. Many a homeowners have to be forced to foreclose as well.

As a result of this the banks too have had to let go of their ability to recover the entire repayment of many mortgage loans. This is has become a learning lesson for all the financial institutions and hence they take extra care while lending out money either for real estate or for other mortgage loans for the purpose of income.

Located in Minnesota with one office in Minnetonka and another in Claremont, the Equity Bank too takes a lot of care to analyze their customers for the qualification of procuring a loan. Steve Liefschultz the chairman and CEO of this privately held and managed company has worked a lot behind the successful transactions of this company with its customers and has a wide horizon of knowledge of the loans associated with real estate.

It should not be thought that the banks or financial institutions are unable to give the loan amount instead it is just that the validation and confirmation of the borrower’s information should be thoroughly done before giving out the loan. This is all that the three ‘Cs’ entail with it.

About Paul M. Bauer

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