Whether you are a potential home buyer, looking to find a home, of your own, or an existing homeowner, who seeks better terms, and/ or rate on your mortgage, it’s important, to know a little more about the process of getting the best one, at the best terms, which fits your needs, priorities and situation. Since the vast majority of individuals, use a Mortgage loan, to pay for their house, I felt it might be helpful, to review, some things to consider, from the onset. With that in mind, this article will attempt to briefly examine and consider, 5 steps, you might wish to consider following, to ensure this often – tense, stressful process and period, becomes somewhat easier, and more successful.
1. Check, and fully review, your Credit Report: Especially in today’s atmosphere and environment, where there is so much Identity Theft, it’s smart to begin, by doing this. First, review the report for accuracy, etc. Then, look at the items, and report, the way the lending institution might. Begin, by looking at your debt – to – income ratio. The desirable maximum for this changes, periodically, but if you keep it to about one – third (maximum), you’ll probably be somewhat safe. Prepare about 3 months, or more, before you begin the process, and pay – down, your debt. Do not wait to the last – minute to do so. If you can do this, a year or more before, ir’s even better! Look at the report, and consider, whether, if you were the lender, would you consider you, to be a good risk?
2. Repair: One of the primary reasons to begin Step One, as far in advance, as possible, is to give you the opportunity, to make any necessary repairs, and to enhance your credit rating, as much as possible. Be careful to avoid requesting or taking out any new credit during this period, because doing so, might harm or reduce your credit score!
3. Patiently wait after steps one and two: Optimally, waiting a year, will get you the best results, but you should always wait, at least 3 or more months, after you’ve made your repairs and/ or fixes, and/ or paid – it – down, to best position yourself.
4. Stay away from any credit offers, etc, during this period: That offer you get in a retail store, which will give you, immediately, an extra discount on your purchase, is not harmless, but, rather, might negatively impact your overall credit. Keep your eyes on the target!
5. Be prepared for the down – payment: Most lenders will want to know where your down – payment, and other funds, come from. At least 3 or more months in advance, place your probable down – payment, in an account, you can clearly provide statements for, demonstrating your ownership, etc. Also, realize, most lenders seek borrowers, with a significant amount of other assets, etc.
A little bit of preparation, and paying attention to some relevant details, will generally make the process, go smoother and easier, and more successfully, If you really want and/ or need that mortgage, do, all you can to be prepared!