Where to start....
Before you start even looking at a house, its always a good idea to take a realistic assessment of your finances.
A. Visit AnnualCreditReport.com and make sure your credit report is correct. If you see errors on it that need fixing, it will save you a lot of stress and trouble if you do this before finding out about these issues while trying to buy your dream house.
B. Gather your income documents. Depending on whether you are employed or self-employed these items are W2s, Pay Stubs, Tax Returns, or proof of other sources of income as necessary (pension social security, child support, alimony, etc/)
C. Gather your asset documents. Bank Statements, IRAs, stocks, bonds if you intend to use any of these assets for your down payment. Determining how much you have by way of assets will help show the lender how much skin in the game you have, possibly benefiting you with better terms.We can offer loans, depending on your situation, that allow for 1% down or in some cases 0% down. Call us to find out more!
D. Be prepared to have your credit checked. Determining your Debt to Income ratio is one of the most important aspects of the home loan process. There is a limit to how much debt, in relation to your income that is allowable by a lender. No one wants you to be unable to afford your house payment. Lenders are looking at your long-term debt, ie: car payments, student loan payments, revolving credit cards, essentially what ever debt is located on your credit report. This does not include your current utility bills, monthly gym membership, etc.
The more information you provide your loan officer, the better picture we can get about how to proceed. Get specific about the type of home you want, the area, and the amount of monthly payment you feel comfortable paying. Don’t forget you’ll be paying for home-owners insurance, taxes, and possibly mortgage insurance as well.
The more prepared you are, the smoother the process can go!