Congratulations! You’ve made the decision to buy your first home (or your next home) and the next step is applying for a mortgage. Being prepared for the mortgage application process and anticipating any bumps in the road is the best approach in today’s home buying marketplace, no matter what your financial situation.
Be aware that in the past few years, mortgage rules have changed. In today’s market, it is critical to get pre-approved before you start to look for a home. This benefits you in two ways. First, you’ll be aware of your budget and won’t be tempted to fall in love with a house that’s out of your reach. Second, pre-approval irons out the mortgage process because you can resolve any potential issues ahead of time.
Save yourself some time and have a conversation prior to meeting with your mortgage provider, and they can provide you with a list of required documents you’ll need to complete the pre-approval process.
What if you’re aware you have some credit history issues that will negatively impact the process? Be up front with your mortgage provider – they want to help you get the mortgage and they appreciate and want to avoid surprises further down the line.
Looking for advice on which mortgage provider to use? Look for an institution who will keep your servicing local. This includes processing your payments, paying taxes and insurance, and being available to answer questions about your mortgage. Many financial institutions and most mortgage companies sell mortgages on the secondary market after you close, meaning you won’t be dealing with the same friendly face if any issues occur. Credit unions are more likely to service your mortgage themselves. In the end, you’ll enjoy that same local friendly face over the life of the loan.