Smart Tips For Uncovering Lenders

4 Important Mortgage Tips for the First-Time Home Buyer

Arranging a mortgage certainly is a big commitment. If you’re a first-time home buyer, therefore, it’s important that you find the best deal available. In order to get approval and qualify for a good rate, you’ll need to be in great financial shape. This means that before you arrange for the mortgage, there are several things you should be aware of. Here’s a look at a few tips that should help you secure the best deal possible.

Have a financial plan

Before you apply for the mortgage, it’s vital that you take a bit of time budgeting. To begin with, consider whether you’ll be able to afford paying back the amount you’re borrowing.To begin with consider whether you’re going to afford to pay back the amount you want to borrow. Next, you’ll need to be sure that the amount you borrow will be enough to purchase the property, with some spare left to cover associated costs. Do you expect to have any problems with the monthly repayments. Get a mortgage calculator to work out the math, so you’re well prepared before you approach a lender.
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Get your credit right
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When trying to assess how much of a risk you are, two of the most important factor your lender will consider are your credit score and credit history. Before you apply for the mortgage, therefore, you’ll want to take a look at your credit report. The last thing your lender wants to see is credit cards with high balances. So be sure to pay off your debts, or at least have these balances at a minimum. It also helps when you have no outstanding loans, such as when financing a new car. Having your credit in good shape is a sign to the lender that you’re good at managing your finances properly, and this improves your chances of getting approved.

Length of loan

This certainly is one of the topmost considerations. While a 15-year mortgage may be provided at lower interest rates, your monthly payments will be bigger than if the repayment period was stretched to 30 years. If you can afford the large payments, taking a shorter term loan would be a good idea.

Job stability is important

Since most lenders need to see that you’ve been in a certain job for some time, having a stable job helps. So if you’re thinking about changing jobs, you may want to secure the mortgage first before you proceed. Many mortgage lenders only consider applicants who have been in their current jobs for at least 3 – 6 months. Keep in mind that one of the things they will require is proof of income. This means obtaining the relevant documents from your employer. You may also need to provide pay slips and bank statements for the last three months, so they can have a look at your earning and spending patterns.

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