How to Apply for a Mortgage
So, you’ve decided to buy a home! That’s great news!
If you’re like most people, you’ll also need to get a mortgage to pay for the home. If you never applied for one before, the application process can seem daunting. That’s why we’ve put together this guide to help you apply for a mortgage with ease.
What to Do When Applying for a Mortgage
Check your credit score and your credit report. If your credit report has any errors on it, dispute it to improve your score. Your credit score plays a big role in how much interest you will need to pay. If you have a high credit score, lenders will charge you a competitive rate. If you have a low credit score, lenders will consider you a risk and charge you a higher rate. If you find that your credit score is not that great, work on improving it before you apply for a loan.
Research the different types of mortgage loans out there. There are various types of loans out there like conventional loans, FHA loans, VA loans, etc. Each of these loans has different terms and may be more suitable to certain sections of the population. For instance, if you are a veteran, getting a VA loan would be your best bet.
Compare what different lenders have to offer. Once you have an idea about the kind of loan you want to apply for, you’ll need to shop around and see what different lenders are charging for that type of loan.
Apply for pre-approval to borrow a certain sum of money. Doing this will tell you how much you can borrow and at what interest rate. Given that many realtors require you to have a pre-approval letter ready before they start showing you homes, this is an important step.
Get your paperwork ready. You don’t want to delay the process in any way. So, before you start the application process, check what documents you will need to submit to the lender and get them ready.
Start looking for your home. Once you have your pre-approval letter in hand, you can start shopping for homes!