Being a guarantee to guarantee the credit of another person is a great responsibility since it commits you to pay the debt in case the applicant does not. Basically it makes you a participant in the debt, so your borrowing capacity will be affected in a certain way. This is why you may wonder, if I am a guarantor can I request a mortgage loan?
Can I ask for a mortgage loan if I am a guarantee?
The first thing that you should take into account is how your debt capacity affects being a loan guarantee. As established by the Superintendence of Banks and Financial Institutions of Chile (SBIF), a person cannot borrow more than 30 to 40% of their income. So when a person applies for a loan, their borrowing capacity decreases, and when it becomes the guarantee of another debt, it happens the same.
When a client goes to a financial institution to apply for a mortgage loan , it makes a complete evaluation of the client, which includes if he is indebted in other loans, how much his income is and what part of them is committed, if he has outstanding debts and If it is a guarantee of another credit. If any of these aspects indicates to the bank or financial entity that you are not a suitable subject because your borrowing capacity is reduced, they could deny you the mortgage loan until you get out of the situation that makes you a high-risk client.
If you are a guarantor, it is very likely that you cannot apply for a mortgage loan in Chile , since you are committed to another debt, even if it is not yours, and therefore you already have a legally committed part of your income, so lend a large sum of Money in these conditions involves a high risk for the bank, risk that they are not willing to assume.
Ask you for an even greater guarantee for your mortgage credit
In this case, the bank is likely to ask you for an even greater guarantee for your mortgage credit to make sure you can back up your debt. However, the bank is not obliged to grant you the mortgage loan if it considers that your borrowing capacity is already diminished by being collateral in another loan, according to its internal regulations. In other words, the bank reserves the right of admission as far as taking risks is concerned.
In summary, if you are an endorsement your chances of applying for a mortgage loan in Chile decrease considerably, so you should seriously consider the matter before deciding to become a credit guarantee. If you do not have your own home yet and wish to acquire it through a mortgage loan, it would be most convenient not to become a guarantee of any debt. Thus, your borrowing capacity would remain intact and you will be more likely to access your mortgage credit.