Getting a mortgage involves not only a lot of thinking but also a great deal of preparation. You should start making sound life decisions leading up to your actual housing loan application.
To secure the most suitable mortgage for you with the least stress possible, do these five things months — or even years — before you speak with a lender:
Don’t switch jobs
Cavite Properties, a Lancaster review site, would agree that a good history of employment is an important part of getting the nod from mortgage financiers. Be employed for at least two years before your housing loan application, preferably in the same company.
If you must quit your long-time job and go somewhere else, stay in your current field to lessen the uncertainty and ensure continuity of occupation.
Get a promotion
To impress your prospective lender with your capacity to pay, work hard to move up the corporate ladder, or at least get a raise. It would beef up your CV, painting the picture of financial stability.
Pay your bills on time
Don’t miss your credit card payments to establish your reliability as a borrower. Lenders will only consider your credit history for the past three years. If you have negative information in your name, take your time to rebuild your credit score.
Apart from making small purchases on your credit card, you could also capitalize on your utility subscriptions, such as phone and internet plans, to improve creditworthiness.
If you plan on starting a family, don’t have kids before applying for a mortgage. Your prospective lender would size you up based on the number of dependents you have.
Increase your savings
Most importantly, making your bank account fatter. Most lenders don’t provide 100% financing to see whether you have the means to shoulder a portion of the property cost easily. You also need some cash reserves, ideally three months’ worth of your projected monthly amortization.
Obtaining a mortgage is a privilege. Develop healthy financial habits now to qualify for the housing loan you need in the future with little fuss.