FIVE TIPS FOR MAKING A MORTGAGE APPLICATION
Many first time buyers may not be aware of the mortgage application process. There is some preparation involved, usually starting weeks or even months before a buyer decides to purchase a home. Here are 5 helpful tips for making a mortgage application that will end in success:
1. Credit Scores Count. Before making application, do everything you can to shore up your credit scores. If you see an error on your report, get it corrected immediately. If you’ve made a late payment, contact the creditor to see if you can resolve the issue.
If you need professional help in credit enhancement, there are credit specialists who can make a difference in a relatively short amount of time. Sometimes hiring a specialist, who has the experience and knowledge of the credit industry, can make a big difference in your ability to get financing, as well as your ability to get better mortgage rates.
2. Be prepared with documentation when you apply. At the first meeting with the lender, they’ll give you a list of items you’ll need to bring when you make the formal loan application. You should bring everything they ask, and be prepared to supply more information later, if required. Some buyer’s can get weary of the amount of paperwork that is often required. If you start to feel encumbered, remember that the lender is about to put a lot of money out and they want to be assured that you are creditworthy, and that the home is worth what they are lending. (Remember the Golden Rule – He show has the gold makes the rules:)
3. Disclose Everything. Lenders will find out everything, so it doesn’t do any good to withhold. They will submit an IRS form 4506 (tax return request) and will know all about your income and deductions. To ensure a successful loan approval, it’s better that they find out any issues early on, rather than days before settlement. You might as well be upfront and avoid any last minute problems.
4. Be Patient. Mortgage underwriting is more complicated during these “post-bubble” days. It can take longer to be approved and it definitely takes more paperwork. Don’t add to the process by delays caused by dragging your fee on paperwork.
5. Be ready to provide more documentation. Lenders are asking for more information, beyond what Fannie Mae, Freddie Mac or FHA/VA require. It doesn’t mean anything is wrong, or that your loan is in danger, necessarily. It just means the lender needs to document something else. Don’t stress about it and keep your eye on the prize.
Choose a reputable local lender, with a loan program that fits your needs. Contact us for our list of preferred local lenders.
photo credit to miong on Flickr