A mortgage is a huge financial decision. It represents a major decision, and therefore deserves all the attention you can give. You can make a good decision if you are in the know.
A solid work history is helpful. Lenders will require you to have worked for at least a year or two before approving you. Changing jobs can also disqualify you from a mortgage. Do not quit your job while a loan application is in process.
Now is the time to try refinancing your home even if you are upside down on the mortgage. There is a program out there called HARP that helps homeowners renegotiate their mortgage despite how much they owe on the property. Speak to a lender now since many are open to Harp refinance options. You can always find a different lender if this lender won’t work with you.
Any changes to your financial situation can cause your mortgage application to be rejected. Don’t apply until you have had a steady job for a few years. Do not change job while you are in the process of obtaining your mortgage, either.
Predefine terms before your application process, not just to prove to your lender that you are able to handle any arrangements, but also to keep it within your monthly budget, too. This means setting a limit for monthly payments, based on what you can afford and not just what type of house you want. You do not want to buy an expensive home that leaves you cash poor.
You might want to look into getting a consultant so they can help guide you through this process. You need to understand the mortgage business, and a professional can help. A consultant will make sure that you are treated as fairly as the mortgage company.
You should look around to find a low interest rate. The bank wants you to take the highest rate possible. Do not be their next victim. Give yourself several choices by looking at many offers from different lenders.
Look into the background of your mortgage lender before you sign on the dotted line. Do not trust a lender you know nothing about. Ask people you trust. Look around the Internet. Look up complaints on the BBB website. Know all that’s possible so that you’re able to get the best deal possible.
Learn how to avoid shady lenders. While there are a lot of places that are legitimate, a lot will try to take all your money. Avoid the lenders who talk smoothly and promise you the world to make a deal. If the rates appear too good to be true, be skeptical. Those lenders who advertise that credit issues are not a problem are almost always predatory lenders. Don’t do business with any lender who encourages you to lie.
If you are unable to obtain a mortgage from your credit union or bank, talk to a mortgage broker. A broker may be able to locate a mortgage that is suitable for you. They work with many lenders and can guide you in making the best choice.
Close excessive credit cards before applying for a loan. Even if you have zero debt on all of your credit cards, if you have a lot, you can look financially irresponsible. Closing all accounts other than a couple will help you get a great interest rate.
If you don’t mind paying more on your mortgage payment, consider taking out a 15 or 20 year loan instead. You end up paying less in interest because you pay the loan off sooner. After all is said and done, it will save you quite a bit more than a loan that’s for 30 years.
Use the information above to help you find a mortgage that is right for you and your family. Don’t let the huge amount of knowledge available to you overwhelm you. Rather, let the knowledge be your road map to mortgage success.