Navigating the Mortgage Application Process: Do’s and Don’ts
Buying a home without a mortgage is nearly impossible, so you must meet mortgage application requirements to finance your next home. If you do this for the first time, the standards are even higher. The process is complicated, but the right first time buyerA borrower purchasing their first property. mortgage advice can get you through it all by breaking everything down into simple steps you can take. Use these do’s and don’ts to navigate the mortgage process when looking for your first property. They’ll help you improve your odds of success while minimizing the risks of process pitfalls others might fall into.
Do: Get mortgage preapproval before you start looking at properties. Doing this usually means income verification and credit checks. You’ll have a better idea of what you can afford, which will help prepare you for the mortgage application.
Don’t: Change where you work before closing. The loan approval process goes much more smoothly when you demonstrate consistent income and employment. It also spares you going through potentially two major life changes simultaneously.
Do: Keep all your existing accounts current. Missing payments can hurt your credit health. That might influence your mortgage loan approval, and late fees or trying to catch up on bills can deprive you of cash when attempting the biggest purchase of your life.
Don’t: Misrepresent anything. One of the most crucial pieces of first time buyer mortgage advice that you might ever get is to give information that is accurate and precise. Please don’t skip any details, and ensure you review everything in your application carefully before you sign it. Of course, you want to look as good as possible, but mortgage lenders do thorough verification of all the information you provide them. They’ll go through bank statementsA record of a borrower's financial transactions often requir... and pay stubs in agonizing detail and review your daily living costs when determining your ability to make mortgage payments now and in the future.
Do: Be resilient. You’re going to encounter obstacles and adversity along the way. Persistence and consistency are crucial to keep moving forward while trying to buy a home. The process of applying for a mortgage can take many months, and it often runs longer than usual for initial buyers who are getting all their documentation in order.
Don’t: Change your credit if you can help it. Applying for new credit might temporarily lower your credit score, but opening new accounts might skew your current debt-to-income ratio. Even paying off an account in collections or closing a credit card might temporarily drop your score.
Do: Let your lender know of any changes to the loan amount or contract. Common changes include making the down payment bigger or smaller than previously discussed. Communicate any change quickly to prevent delays in your loan approval or closing.
Don’t: Apply if you have doubts about your financial standing. The dream of home ownership is tantalizing, but don’t let it blind you into signing up for something you can’t repay.
These do’s and don’ts are just the tip of the iceberg in terms of first time buyer mortgage advice. Your lender is another valuable source of information and guidance. You need to contact them first and foremost if any of these don’ts winds up becoming something you have to do. The lender you’re working with can help you minimize how much influence it has on your journey towards home ownership. Follow this advice as closely as possible so you get through the closing and into your next home as quickly and easily as possible.