Are you house hunting and getting ready to buy your first home? If so, chances are that you'll need to get a mortgage as well. The process of getting approved for a mortgage may feel stressful, especially if you have concerns about the approval coming through. Here are some tips that will give you the best chance of success.
Clear Up Your Credit
Part of getting approved for a mortgage involves a credit check, where any potential problems will be scrutinized by a mortgage lender. It's why you should take the extra steps to clear up your credit as much as possible before applying for your mortgage. Start by pulling your credit report from all three major credit reporting companies, and look for any discrepancies between them. A problem you may notice is that some items you thought were cleared from your credit report are still showing up on your credit reports. You'll want to clear these items up so that they do not show up on a credit check for a mortgage.
Save Up Your Money for the Down Payment
A big part of your mortgage approval will come from the amount of money you have saved up for a large down payment. As you can imagine, a bigger down payment will reflect on your being capable of saving money, which gives you a better chance of having the mortgage approved. In addition, a big down payment has several benefits in relation to your mortgage. You'll end up paying less money in interest based on a smaller loan amount, have a lower interest rate, and not have to pay private mortgage insurance. Aim for 20% for a down payment to maximize the benefits that you'll receive.
Use a Cosigner
If you have big concerns about your credit history, know that you can always use a cosigner to help have your mortgage approved. This is essentially someone that has great credit and is willing to take on the potential financial risks if you are unable to pay your mortgage. It doesn't have to be a person living in your home either, since it can be a parent or other relative that is willing to vouch for your financial responsibility.
These are just a few tips that will help ensure that your mortgage application is approved. If you have questions or concerns, work with a local company that specializes in working with first-time home buyers, such as Cornerstone Residential Mortgage.Share
28 February 2019
When it comes to borrowing cash for a new house or a nice car, how much money do you really need? Although you might be tempted to mortgage yourself to the brim or borrow a little more than you should, the fact of the matter is that everyone has financial limits. My blog discusses the impact of borrowing more than you need, so that you can make smarter decisions with your money. In addition to keeping you out of trouble, this valuable information might also improve your quality of life and protect your financial future. You never know, it could make all the difference.