Will You Qualify - What You Need To Get A Mortgage
If you are a first time
homebuyer, navigating all the new information about homeownership,
the home buying process, and mortgages can seem overwhelming. If you
are beginning the mortgage shopping process, but have no clue as to
what information you’ll need and whether or not you’ll even
qualify, here is some information that may make the process a little
Will I Qualify For A Mortgage?
There are essentially three
things that lenders look at to determine whether or not you qualify
for a mortgage.
When purchasing a property, all
income of a homebuyer must be validated by a mortgage underwriter in
order to receive a loan. Income verification can be done using
several types of documents such as a W-2 statement, paycheck stubs,
or income tax statements that show proof of income. These documents
usually will have to span a period of two years or more to show you
have a history of a steady income. Income proof can include such
things as child support payments, disability payments, or income from
the Social Security Administration. These additional monthly payments
can increase your potential to qualify for a mortgage, as well as the
amount you will qualify for, but like regular income, must be
validated in order to count.
Another important factor in
getting a mortgage will be your debt-to-income ratio. This involves
looking at your total debt load and monthly payments, including car
payments, credit card debt, and any student loan debt. If the ratio
of debt exceeds 40 % of your income, you will likely have to pay off
some debt before you will qualify for a loan. In this case you may
want to seek out the advice of a financial advisor to help with this
The final consideration that
lenders will take into account in determining whether you qualify for
a mortgage is your credit history and score. They will not only be
looking for a strong history of on-time payments for all your debts,
but also that you have already established credit. You can arm
yourself with this information by getting your free credit report
from sources such as Equifax, so that you are able to check that it
is accurate and up to date.
When getting a mortgage, being
prepared with a little background research and all required documents
will make the process simpler and less stressful. Armed with this
information, you will be able to get the best possible deal with a
lender who is right for you.
Have a question about a home or want to talk about selling yours? Or, if you have any other questions or comments, then feel free to e-mail or call using any of the information below. You will get a response as quickly as possible.