To buy your first home, you likely will need a mortgage. In fact, before you even start looking at houses, you should look into your mortgage prospects. Here are 5 ways to get the mortgage-process started.
- Meet with a loan officer before looking at homes – This will help you determine whether you have credit issues that may need to be resolved first. Additionally, a loan officer can help you better understand how much house you can afford before you begin your search.
- Pay off as much debt as you can first – This will help keep your debt-to-income ratio down. Lenders look at your income and all your debts – such as student loans, car payments and credit card debt – to determine how much you can afford to borrow.
- Consider consolidating or refinancing student loans – If you can’t pay off student loans before you buy a home, look into whether you can lower your payments. You’ll have to decide whether it makes sense to stretch student loan payments over more years to buy a home sooner.
- Show a solid work history – Typically, a two-year work history is required, but there are always exceptions for certain situations. For example, sometimes school can be considered as part of that history. Your best bet is talk to a licensed loan officer, and he or she will help you determine everything you need to qualify for the best mortgage rates and options.
- Be prepared to document everything – You’ll need tax returns, bank statements, brokerage statements and other documents to verify the source of any money you plan to use. The lender will also verify your employment and income.
Once you check those tips off your list, you are ready to start looking for your new dream home! If you have questions regarding how to get your mortgage started, feel free to contact the Housing Buzz team!