Borrowers typically use the following items to secure a mortgage loan:
Collateral: This is usually the property being purchased with the loan. If the borrower fails to repay the loan, the lender can seize the property to recover their funds.
Down Payment: Borrowers often provide a down payment upfront, which is a percentage of the purchase price of the property. This demonstrates the borrower's commitment to the investment and reduces the lender's risk.
Credit History: Lenders assess the borrower's creditworthiness by reviewing their credit history and credit score. A strong credit history indicates the borrower's ability to manage debt responsibly, which can affect the loan terms and interest rates offered.
So, the items borrowers use to secure a mortgage loan are collateral, down payment, and credit history.