Want to make sure your home purchase loan process goes as smooth as possible? Here are seven mortgage tips designed to assist in facilitating the process!
Get a comprehensive preapproval.Sellers often prefer buyers who come with a preapproval letter in hand when making an offer to insure that the financing will come through. Having a preapproval letter can also sometimes help you avoid any bumps in the road later down the line.
Maintain your credit profile.
It's best to be aware of what your credit score is months leading up to your home purchase. Try avoiding any major changes to your credit obligations. That means do not apply for additional credit cards or miss a payment on one. This can often cause issues during the loan approval process.
Request a copy of your credit report to ensure you know exactly where you stand. You're entitled to one free copy of from each of the three credit bureaus once per year, without it negatively affecting your score. To monitor your credit score every couple of months pull a report from each bureau one at a time every four months.
You'll want to make sure you have access to all of the documentation you are going to have to provide to your lender. Two months leading up to buying your home, collect pay stubs, bank statements for all bank and investment accounts, W-2s, tax returns for the previous two years, canceled rent checks, and any mortgage or property tax statements for other property you own.
Don't move money around.
In the months leading up to the purchase, don't make any significant changes to your finances. Avoid creating a headache for yourself by having to show more paper trails.
Prepare to write letters.
It may seem strange but in some situations lenders will ask for letters of explanation in regards to certain transactions or issues in your financial life.
Get your gift early.
If you're planning on receiving a gift in order to cover the down payment, it's preferred to have it in your account 2 months prior to purchasing your home. This avoids your lender having to source where the money came from. If that isn't possible, a simple written explanation from the gift-giver will be required.
Self-employed? Be even more organized.
Since 2014, there have been even stricter mortgage restrictions and if you're a self-employed borrower that means more hurdles to jump through. American Pacific Mortgage has loan programs specifically tailored to the self-employed! Contact me for more info.