New year thinking of a new home? It is a good idea before you start looking for a home to get approved for a loan. Finding the right loan is important. First consider requesting a copy of your credit report from one of the three major credit bureaus. You can get this info for free. Review the report for errors and to see your credit score. If you find any problems there is a dispute resolution process. Some lenders will help you with this for free. Do not pay anyone an upfront fee to fix problems this usually does not work. Knowing your score will give you a better idea of the kind of loan you can get for your home.
Good to Know Basics of Home Loans
Getting qualified for a home loan is a good idea. What you can afford depends on your income, credit rating, current monthly expenses, down payment and the interest rate. There are different kinds of loans available when you purchase a home and each has different requirements. The type of loan you get will be determined by your down payment amount and your credit score.
A Home Buyer Profile
Generally lenders like to see stability, they look at your income and your debts such as car payments, credit card, installment loans including student loans and child support you might pay out, etc. The lender likes to see you have approximately a two year work history or more in a related field. If you have been attending school and get a job in your area of study that can count also towards time on the job. Lenders look at each applicant on a case by case basis so sometimes they can tweak things a little. If you currently own a home and want to keep that home as a rental you will need to qualify for both payments.
It Might Seem Complicated as you Look Into Home Loans
No one understands all of this at first. My advice is to try understand the basics. You know how much you think you can afford monthly and you know how much you are working with cash wise to get into your new home. Knowing this will help you determine the type of loan you might be getting . For more details on basics of home loans read the complete article…
by Teresa Larson, Village Real Estate, Murray, Utah
20+ years real estate experience
©Teresa O Larson PC, 2005-2015