Getting a loan has gotten increasingly difficult over the past few years and I don’t expect that will change in 2012.
Here are some tips that will put you in the best position to secure a Mortgage this year:
1 – Know Your Credit – Your credit scoress are the first things I look when pre-qualifying a borrower, it is important to know where you stand with all three Credit Bureaus. Nowadays a 740 FICO is considered perfect credit but in the right circumstances a borrower can get a loan with a FICO score as low as 600.
2 – Gather Your Documents Now – There are some basic documents that all lenders will require when applying for a Mortgage: 2 Most Recent Paystubs, 2 Most Recent Bank Statements, 2 Most Recent Years Tax Returns & W2s. The sooner you can gather these documents, the easier the whole process will be.
3 – Time is of the Essence – As soon as your Loan Application is submitted it is important to get in any documents that the lender is requiring. Remember that a delay in closing could cost you additional closing fees and you could even lose your interest rate.
4 – Your Credit & Employment Must Stay Put Until Closing – Just because your loan is approved it doesn’t mean that you can go finance that new car or apply for new credit lines, it is best to avoid anything that will affect your credi before closing. Lenders will often pull your credit one last time in the days leading up to the closing. The same goes for your employment, a job change prior to closing is typically not a good idea.
5 – Consider Shorter Term Loan Options – Because interest rates are at an all time low, many people are considering shorter term options. If you have a 30 Year Mortgage with an interest rate above 6% you could possibly refinance into a new 15 or 20 Year Mortgage and keep the same payment while knocking years off your loan term. In some cases you may even save money on a monthly basis, it’s worth considering.
6 – Keep Trying – If one lender denies your loan that doesn’t mean that all lenders will. Most lenders follow Fannie Mae & Freddie Mac guidelines but also have their own requirements, and some lenders may be stricter than others. Depending on the reason for the denial there may be other options.
7 – Seek Help – Do your homework and seek help from someone that you trust in the industry. If you have any questions I’m always available by cell at 207-590-0337 or by email at email@example.com.