Even if you are really anxious and you want to jump right into applying for a mortgage through a home loan company, you will want to wait a little until you have fully prepared yourself. This will ensure that you are giving yourself the best opportunity for being offered an interest rate that will easily fit into your budget. If you are not careful and you fail to prepare before applying for the mortgage, you could face a lot of disappointment when you are denied. Therefore, you are going to need to review and make use of the following tips.
Closely Examine Your Credit Reports
You will need to examine all three of your major credit reports, as they may not have the same information on each one. This is because some creditors may report to only one or two agencies, while others report to all three of them. The goal with this is to carefully examine all of the information found on each one so you can spot any errors that could ruin your chances of getting the home loan you need. This needs to be the very first thing you do because the handling of any disputes that you make can take anywhere from a few weeks to a couple of months to get cleared up and for your credit score to be adjusted accordingly.
Add More To Your Down Payment Fund
It is important to make sure that you are avoiding the funding of any more loans during this time because the new loan will impact your credit score in a negative way. Also, it will hurt your debt to income ratio, making your situation look less ideal for a home loan approval. Therefore, you will need to gather more funds for your down payment through another method, such as borrowing from family or working some overtime at work. Be prepared for the loan company to ask for documentation showing where you got the money for the down payment. Savings from your income is okay, as well as a written statement from family saying they gave you the money.
Once you have done those things and anything else a broker might advise you to do, you will be ready to apply for a pre-approval from a home loan company. When you have that, you can then begin to view the homes that interest you and that fit within your budget. You will be a new home owner before you know it.Share