Hopeful home buyers either make moves to smooth out the multi-step process of buying a house; or they ignore taking advance action and set themselves up for a long and more complicated road to owning a home. One of the smartest moves buyers can make is getting prequalified for a mortgage.
Mortgage prequalification has several benefits for home buyers. It begins by building a relationship with your lender, it shows you what type of home you can afford, and exhibits your seriousness to the seller. In case you aren't familiar with the steps it takes to pre-qualify, here's the 411 on mortgage prequalification.
Mortgage prequalification is, in a nutshell, when a bank looks at your finances and credit worthiness and decides whether or not you can afford to own a home, repay a mortgage and how much of a home you will be able to afford.
It pays for home buyers to know how much money banks will loan them to use for their purchase. Getting pre-qualified answers this question and lays the groundwork for the type and size of house you can afford. This takes some of the guesswork out of searching for a home, and minimizes the chance you will fall in love with a house beyond your means.
The perfect time to get pre-qualified is when you have decided to buy a home and start the search, but haven't actually started yet. Put some time into talking to a well educated lender and determining whether or not you are financially able to buy, or if home ownership is out of reach. If you obtain mortgage prequalification, you will have a clearer picture of the price range and neighborhoods that fit into your budget.
Visit a reputable lender who is experienced in mortgage loans and who will help you throughout the prequalification and home buying process. Be sure to take your income statements such as pay stubs and W-2s, proof of identity, and a list of your debts and assets when meeting with a lender. The lender will also pull your credit report to check your credit score as an integral part of approval, so it's smart to make certain your credit is in order and your credit card balances are as low as possible. He or she will review all this information and reach a decision about your mortgage.
Buying a home is exciting and fun, but it's also challenging and sometimes complicated. Mortgage prequalification is a smart financial step down the path to home ownership. If you are looking to buy a home and need to get prequalified for a mortgage, sign up for an appointment now!