Mortgage Tips for the First Time Home Buyer

As a first time home buyer do you feel like you might need a few tips on qualifying for a mortgage?  It is just a guess but I bet you have heard it is a time consuming and sometimes frightening process if you have not applied for a mortgage before. Take a breath and remember that there are millions of homeowners out there and they have all been through the mortgage process and are now living comfortably in their dream home. Here are a few things that you should know as a first time home buyer before you begin the application that will make the process a lot easier.

First Steps

If you have determined how much you want to spend on a home do you have your down payment? There are a wide variety of mortgages that can suit your finances. You need to be prepared before you make an offer on the home you have chosen. All funds must be available prior to your loan being approved.

Take the time before you approach a lender to check and correct your credit report.  This might take some time. So begin this process immediately. Once corrections are complete and your credit report shows that you will qualify for a mortgage you are ready to visit the lender.

As a first time home buyer you probably do not have a wide experience with lenders.  Pick your lender carefully.  Ask family and friends for recommendations. If you have already conteacted a Realtor they will be an excellent source for information.  Realtors deal with lenders at every sale.  They will generally know the best lenders in your area.  Your bank is also a great source for a recommendation; especially if you already have a comfortable relationship with your loan officer.

Working With Your Lender

As a first time home buyer you may have mortgage options that are advantageous for you. Do you know all of your mortgage options?  Discuss this with your lender prior to selecting a mortgage.  It is the loan officer’s job to make sure you understand and qualify for the available mortgages.  Don’t miss out on a chance to apply to the mortgage that is most advantageous for you.

Begin a pre-approval process as soon as possible.  Pre-approval is required in all home sale contracts. It can be a nasty surprise if your mortgage is turned down just before you get to the closing table.  Getting pre-approved will ensure that you have answered many of the hard questions about your income, debt and assets prior to the final approval. Be thorough; what you omit or answer incorrectly can delay or even result in a denial.

Pre-approval is accomplished. Now it is up to you to keep your credit report in tip-top shape.  Do not apply for new credit or make any large purchases prior to your closing.  You will have your credit report checked one more time just prior to closing. 

Do not make any large unaccountable deposits to your bank accounts.  You must be able to document large deposits to the underwriter.

Finally honesty is always the best policy.  Your loan officer is working with you to find a great mortgage.  Be ready to give a full and complete financial accounting of all income, assets and debt.  The questions you will be required to ask are invasive; but they must be answered.

Do you feel ready to meet the challenges of buying a first home? It's time to give Jason a call at 832-541-5060 to set up a first appointment.