A considerable number of potential buyers shy away from buying a home due to their uncertainty about the buying process. A major cause for concern tends to be mortgage qualification.
Mortgage Qualification Does not Have to be Upsetting
In order to qualify to purchase a home in today’s market, you'll need to have saved downpayment money, have a stable income and good credit history. Throughout the home buying process, you will interact with many different professionals, all of which perform necessary roles. These professionals are also valuable resources for you, especially your mortgage professional.
Here’s the Steps to Help you navigate through the mortgage process:
Get a Head Start on Your Credit - Getting your credit report Free is a good idea. Most credit reports have errors. The Federal Trade Commission regulates the credit services and you are entitled to a Free Credit Report from each of the three major credit bureaus once a year. They are available from www.annualcreditreport.com. There is a charge for your credit scores, but they are not necessary. If you see any errors on your report, follow the instructions and send a letter to the credit service to have all of the errors corrected.
Start to gather all of your documentation - income verification requirements are paystubs and W-2 forms or tax returns, assets would be bank statements from checking and savings accounts, 401K statements, IRA account statements.
Get a referral to contact a professional licensed Loan Originator - your real estate agent will be able to recommend a few licensed loan originators help you determine how much home you can afford. The Loan Originator, and their company, will be working with you through the entire mortgage process. Pick one you are comfortable with.
Consult with your Loan Originator - they will review the documents you gathered for your income and assets. They will review your current expenses and discuss with you the possible mortgage options available for your specific purchase. Be sure not to allow multiple running of your credit reports, this will lower your credit scores. Only allow your credit to be reviewed by the loan originator you have chosen to work with for your purchase.
Talk to your Loan Originator about a Mortgage pre-approval - a pre-approval letter from your Loan Originator will detail the particulars of your qualification to purchase. Including your maximum purchase price, type of mortgage and stating they have reviewed your credit and documentation for program requirements. It will demonstrate to home sellers that you are serious about buying and are Ready to Buy!
Do what the Professionals ask of you and the process will go much smoother. Don’t go out and buy new purchases, like furniture, until you have purchased your new home. Just keep rolling as you have been putting money in your accounts, don’t put big deposits into any of your accounts. Stick to your pre-approved mortgage qualification, so you don’t overextend yourself and get into trouble later.
Hope This Helps.
Kathy McKinney, Realtor, EXP Realty Llc, 460 S Lewis Rd, Royersford, PA 19468
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"Working with eXp Realty was a pleasure. When we started, we had no idea what we wanted, but our buyer agent helps us figure out the pros and cons of all our options. Our agent went the extra mile willing to put in the extra effort to answer our questions, to make sure we were happy with our decisions, and educated about the market and local area."