First Mortgage? Get Started Right With These Tips

First Mortgage? Get Started Right With These Tips

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Purchasing a home is the biggest investment that most people will ever make. In order to buy a home, the vast majority of buyers will need to take out a mortgage. Since the mortgage application process can be grueling and challenging, there are several tips that should be followed to ensure that the process of getting your first mortgage goes as smoothly as possible.

Check Your Credit

When looking to get a mortgage, the first thing that you should do is check your credit. Getting a mortgage will be very tough if you have a poor credit score. You should check your credit before starting the application process to see if your score will qualify for a good loan. If it doesn’t, then you should look for ways to improve your score, such as paying down credit cards and other debts.

Determine How Much you Can Borrow

Another tip when looking to get your first mortgage is to determine how much you can borrow. Most banks are going to want your total housing payments, including your mortgage and real estate tax payments, to be less than 30% of your total gross monthly income. Based on this general rule of thumb, you should be able to back into how much money you will be able to borrow, which will help you to set a home buying budget.

Gather Documents

Before you start applying for a mortgage, it is also be a good idea to start gathering the documents that you will need to apply for a mortgage. Mortgage lenders are going to want a wide range of personal financial information, including your recent tax returns, recent pay statements, statements for all of your bank accounts, and other information that will be needed to underwrite your loan. Gathering all of this information ahead of time will cut back on the amount of time that it will take for the loan to be approved.

Start Shopping Around

The fourth tip to follow when trying to get your first mortgage, is to start shopping around early. You should plan on getting loan quotes from multiple banks, which will give you the ability to compare rates, choose the most affordable mortgage possible, or even try to negotiate the rates and fees down further. Look at a variety of places and talk to a Fresno home realtor about options for buying at a lower price or getting different discounts.

Getting a mortgage can be a very challenging process. To ensure that you are able to qualify for a mortgage, and that the process goes smoothly for you and your family, use these tips to get started on the right foot.

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Categories: Home Financing

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