It is everyone’s dream to own a home or any other property but the mortgage process can at times be too challenging, tiresome and sometimes discouraging especially if the information needed is not easily available. Buying a home in one installment may not be affordable to many and that’s where the idea of a mortgage came from. It is always advisable to fully understand the mortgage process before you embark on the home ownership process through a mortgage. Numerous options are available including real estate agents, loan officers, and government housing agencies among others. You have to make a wise decision on which option to go for and if need be, employ the services of a professional adviser.
The following are steps one needs to follow in order to get their mortgage approval.
Know exactly what you want
Ask which mortgage loans you qualify for and make comparisons. Inquire if there is a fee one is expected to pay if one decides to clear the loan payments earlier. It is advisable to go for the mortgage with less or no penalties. Inquire about any item you did not know about before you sign the loan documents. You should also consider the rates of interest of each and the loan repayment periods offered by each. Having a complete understanding of what one wants always sets path for achieving the set goals.
Make sure you have the right documents
Always make sure you give the correct information. For instance, do not in any case try to falsify your income details so that you can qualify for a mortgage loan. Make sure you have the evidence to documents such as your identity card, utility bills, pay slips, and bank slips. Other documents may also be required depending on the lender. Make sure you present all the documents required by your lender on time.
Ensure you are credit worthy
You can do this by refraining from new credit application or by using a personal loan to help you boost your credit score. Other things that lenders put into consideration are loan payment history, bankruptcies, public records, collections and outstanding balances. Counter check both your active and inactive accounts for any negative balances. It would also help if you have other properties that can stand in for you as securities. These items can be land, shares, stock, e.t.c.
Make use of any self-employment opportunities you may have.
Clarify the income you receive from your business. You will also be needed to state the length of time you have been in the business. The number of lenders willing to consider the application will greatly depend on the time. If you have traded for a short time, few lenders will consider you. You will also be required to provide your profit and accounting details. Ensure these details are as accurate as they possibly can be. A constant level of income for a long period of time will attract more lenders and will give your lender a sense of security.
No more credit before the mortgage closes
This is for the obvious reason. This will lower your credit score so wait till the mortgage is approved before you make more borrowings. Opening a new credit card can have the same effect. You may never know, your credit score can be barely above the cut off for getting the loan and any deductions can have regrettable consequences.
Deal with experts
This is especially useful if you are dealing with issues such as unusual self-employment income, bad credit or any other situation that is not familiar to the broker. In such a situation, it is wise to deal with a lender who truly understands the situation rather than others who will promise to help you out and disappoint you on the end. A specialist broker may also come in handy as they know the best lenders and how to go about the approval process smoothly.
Save as much as you can
You may require to make some minor payments in the course of your mortgage application and approval. You will need to pay the brokers and the financial advisers. You will also be required to provide other documents which may need money to process. Ensure you have enough savings to carry you through this so that nothing that is required in the process misses.
Ensure you have no criminal records
No one in their right state of mind would feel comfortable lending their money to a person with a criminal record. Trust is a major factor when it comes to the mortgage approval process and it would be practically impossible to trust a criminal. It is thus advisable to be on the safe side of the state law prior to and at the time of the mortgage application process.