Prepare for a Mortgage Loan – 5 Steps

Posted on: November 16th, 2012 by

Most of the time potential borrowers tend to sabotage their opportunities of getting the mortgage loan. Every mortgage lending company has its set rules and guidelines for one to qualify. Doing your homework and preparing can help speed up the process of getting the loan and helps to save money too. Getting an approval for this loan is not as easy as it was some years back. Bad credit and the crisis in housing have changed the way lenders and banks do their business and the people they associate with. This means that you have to be well organized in these economic times to get the loan

Below are five steps to ensure you are ready for the loan application:

Begin process of preparation early

The first thing to do is start making preparations early. Getting everything you need won’t happen in a day therefore, assemble all the things you need months in advance. Avoid procrastinating as it could be a stressful affair when the date for application is close and there is nothing in order

Organize your documentation

This will be needed by the lenders and it includes documents with your personal information, assets and income. Therefore, be prepared to give it to them in a manner that is timely. Chances of getting the loan are improved when you are well prepared. These documents should be at least a year old as it helps the mortgage lenders have a better understanding of who you are.

There are other documents that may be needed by the lenders which will vary with each. Lenders are interested in the originals and not the copies. Divorce papers and cancelled checks may be required too as well as tax returns and W2s for at least two years.

Obtain a copy of your credit report

This will be important especially when in doubt about the way view the way you manage your finances. The credit reports from the borrowers may have information that erroneous. It usually takes time to make corrections and knowing what is in this report will be advantageous at the point of applying for the mortgage loan.

Thoroughly complete the loan application

This will help up speed up the process especially when all the information that you give is accurate.

Make sure that you calculate your debt to income ratio and clear some of the debts that you have. Most of the lenders use this ratio as it is a clear indication if you are prepared for another debt or it will too much of a burden to you.

Avoid changing the system

Make use of mortgage professionals that make you feel comfortable and relaxed. In addition, they should be able to address your questions, concerns and needs as well as instill confidence. There are cases where the mortgage companies will not be able to offer exactly what you are looking for and in other instances what you are looking for financially is not available. The difference between success and failure is the mortgage company that you are working with.

Whether you are buying the home for the first time, it will be ideal to seek assistance for a mortgage loan that is quite challenging. Mortgage lenders are willing to work with you in these tough circumstances to offer solutions. If you are prepared to take advantage of the low rate than it time to keep these few steps in mind and within a short period you will be able to get the home you want. Even with bad credit, there are some mortgage loan lenders that are willing to assist.