Essential Guide to Preparing for Your Home Loan Application

Preparing yourself before applying for a mortgage

"Quality over quantity in lending" – Lewis Thompson Preston

A mortgage is a loan used to purchase property or fund other financial goals, with the property serving as collateral. Reviewing options from reputable lenders helps understand terms related to property liens and loan conditions. Before exploring mortgage options, keep these vital points in mind.

Having a clear understanding of credit scores, mortgage interest rates, fixed vs. variable rates, loan periods, and repayment plans is essential for navigating home financing.

What is a credit score and how does it influence your mortgage?

A credit score is a numerical indicator used by lenders to assess your ability to repay loans.

It is derived from your credit history, evaluated by major credit bureaus, providing a comprehensive report that summarizes your borrowing behavior.

Timely repayment of previous debts boosts your credit score, reflecting responsible financial management.

Good credit history increases your chances of loan approval and favorable terms from lenders.

A strong credit score enhances your negotiating power for better mortgage rates.

Where can you access mortgage funding?

Numerous banks and financial institutions offer mortgage products, making it challenging to choose the right one.

However, trusted sources include credit unions, mortgage brokers, and correspondent lenders.

Credit unions often offer competitive interest rates and easier membership requirements.

Specialized mortgage bankers represent specific lenders and can guide you through the process.

Correspondent lenders coordinate with third-party financial institutions, providing access to various mortgage options.

What is mortgage pre-approval and how long does it take?

Pre-approval involves submitting financial details to lenders to gauge eligibility before formal application.

It helps streamline the loan process and strengthens your bargaining position.

Required documents typically include Social Security numbers, bank statements, income proof, debt details, and employment information.

The approval timeline varies depending on the lender’s procedures.

Top-rated mortgage lenders of 2017 include:

Amerisave Mortgage

ClearPath Lending

First Internet Bank

HomeDirect Mortgage

J.G. Wentworth Home Lending

Caliber Home Loans

Vanderbilt Mortgage

Jersey Mortgage Co

Homebridge Financial Services

21st Mortgage Corporation

Ocwen Financial Corp

Mr. Cooper

LendingTree

Pacific Union Financial

Network Capital Funding