How To Improve Your Chances Of Qualifying For A Mortgage
by: marciafreeman on Wed, 25 Feb 2009 at: 10:05 AM Go to: Previous Article Next Article
Prior to accepting an application for a home loan, lenders will qualify you for the mortgage. Some potential applicants may feel uncomfortable about this step because they dont fully understand what qualification for a home loan means. Basically, the qualification process determines if the lender is willing to lend to you and the amount of money you can borrow. You can improve your chances of qualifying for the home loan you need by learning as much as possible about the process.
EMPLOYMENT AND INCOME
The lender uses several measures to determine your ability to repay the home loan you are requesting. First, they will want to know that your employment history is stable. A minimum of two years with the same employer is commonly desired. If not, how long did you work for your previous employer? What if you have had a recent change in employment? Can you demonstrate your reasons were responsible and that the employment is stable? The lender will verify your information with your employer. The lender will look for evidence that you are responsible and have resources to repay the loan.
You will also need to provide proof of the total household income you want held accountable against the loan, as well as your outstanding debt and monthly expenses. The comparison of your debt to income will be evaluated to determine your ability to meet your existing expenses and your projected home loan payment.
CREDIT WORTHINESS
Before approving you, the lender will evaluate your credit report to determine the likeliness that you will make regular, timely mortgage payments. Most importantly, lenders look for a history of consistent payments made on time. They also check that you use credit responsibly, without regularly approaching the maximum levels available.
WHAT CAN YOU DO TO IMPROVE YOUR CHANCES?
Start planning well in advance to prepare for home ownership. Try to maintain your time in job for a minimum of two years before applying for home loan qualification. Request copies of your credit reports from all three major credit bureaus and review them carefully. If any information is incorrect, write to the affected credit bureau to request correction or removal of errors. Reduce your level of debt as much as you can before attempting to qualify for a home loan. The more of these steps you take, the greater will be your chances of qualifying for all the money required for your home loan.
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Similar articles about refinance mortgage, see www.getsmart.com/refinance.
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