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8 Things you should now before applying for a loan!

Getting started on your mortgage is actually pretty simple!

If you're reading this, you're probably thinking about buying a home. But before you get to that point, there are a few things you need to know about the home loan process.
Don't be overwhelmed by the home loan process. Don't be intimidated by the homebuying process. Getting started on your mortgage is actually pretty simple—the hardest part is just filling out some paperwork and waiting for it to clear!

Have you ever looked at the homebuying process and thought, "I'm not sure I could do this"?

You're not alone. But don't worry; we've got your back. Getting started with a home loan is actually pretty simple: all you have to do is fill out an application and send it in!

It's true, though—it can be a little intimidating if you've never done it before. So we've got some tips for making the process less terrifying. We've compiled a list of 8 things you should be doing now to make sure your home loan goes through smoothly and without a hitch. Simply by following these tips, you can speed up the process and reduce the chance of being rejected for a home mortgage loan.

If you're looking for a home loan, you should take these 8 steps first.

1. Don't be overwhelmed by the process. Work with your REALTOR and LENDER to assist you in taking the appropriate actions to get your mortgage ready. Don't forget these important tips to ensure your home loan goes through smoothly and without a hitch.
2. Don't be intimidated by the process. Your experienced REALTOR will provide you with a resource list that should include lenders that are here to make sure you find the home loan that best meets your needs. With a guide that will make the process simple and as stress-free as possible.
3. Getting Starting - At first, getting a mortgage may seem pretty complicated, but in reality it couldn't be easier. It's just a matter of determining how much home you can afford and going through a couple of simple steps. It's your time to start building the life of your dreams—a home is a big investment, and you have nothing to lose by starting today!
4. Paying a mortgage - If you're currently renting a home or an apartment and you have been paying rent for at least two years, you are already paying someone else's mortgage. A good rental history shows that you're a responsible tenant who won't let your landlord down. It shows that you are respectful and dependable. Living rent-free! Living rent-free means you don't pay any money to live there, living rent free is not held against you. However an Eviction needs to be address, If there are any recent evictions in your background, be sure to pay those off before applying!
5. Work History - Recently graduated, your higher education is counted as work if working in field of education. That means if you've been working in the field for which you studied for at least two years and have worked less than 30 hours per week over those two years, then that counts as income! Work history includes: Self-employed with last 2 years of tax returns with adjusted gross income line, Child support for the next three years 14 years of age and under child. Other incomes that are counted are Social Security, Disability Pension & Part-time -Less then 30 hours part time must been on job for 2 years same employer to count as income
6. Minimum credit score - Lenders have different minimum credit scores, restrictions and factors that they consider when making loans—these are called overlays.
In some cases, a direct mortgage is your best option. Many overlays on debt-to-income ratios cannot go below what the government has set as its limit. Low credit score (600-640) DOES NOT MEAN YOU CAN'T GET A LOAN! When a lender takes back—for example, through foreclosure or bankruptcy—or writes off a loan, it is usually considered to be extinguished. This would therefore not count when determining whether you're eligible for certain mortgage programs. Student loans can be deferred, but you may still have to pay 1/2 percent of the total outstanding balance each year. If you don't receive payoff from the recent Student Loan Forgiveness 2022-Because, there are very specific eligibility requirements you must meet to qualify for loan forgiveness or receive help with repayment. Loan forgiveness means you don’t have to pay back some or all of your loan.
Income base repayment plan can be used as long as you are making it on time for student loans payment to maintain a current loan payment balance.
7. Your debt-to-income ratio (DTI)- Are you worried about how much debt you can take on with a mortgage loan? If you're looking at your debt-to-income ratio (DTI) and wondering if it's too high, we've got some good news: it's not. Here's what you need to know about the DTI ratio. What is a DTI ratio? It's a number that tells lenders how much of your monthly income goes towards paying off debt—and what portion of that went toward paying off credit card debt and other types of loans. Your DTI ratio is typically expressed as a percentage but can also be expressed as a decimal point (like 6.5%). A higher number means better credit scores and lower interest rates for borrowing money, but it also increases the risk that you'll have trouble meeting your expenses and keeping up with payments on time. How does your DTI affect getting a mortgage loan? Lenders use DTIs to determine whether or not they should offer you a mortgage loan. They look at all of the information in your credit report, including late payments and collections, to figure out how likely it is that you'll be able to pay back all your debts—including a HOME MORTGAGE.
8. Assets- How much do you for down payment and closing expenses?
When you're planning to buy a home, one of the biggest questions is how much money you'll need up front. The other is how much your closing costs will be. Down payment and closing expenses can add up fast! First, let's talk about how much money you need to put down. In general, it's better to start with a smaller down payment and build up from there than vice versa—so it's smart to aim high rather than low. This allows you to get into a lower interest rate loan with less risk. And if you don't have enough cash on hand, consider getting assistance from local, state and federal down payment assistance programs also, ask for closing cost concessions when placing an offer on a home. Next, we'll talk about what kind of closing costs are involved with buying a home. Closing costs vary depending on where you live and who handles your loan—but they typically include:
- title insurance (this protects against any liens on your property), - survey (the seller pays this fee), and - appraisal (the seller pays this fee)
Getting a home loan can be a daunting task. You may be overwhelmed with the process, or intimidated by it. If you've ever felt this way, then I want to let you know that it's totally normal! But don't worry—there is a REALTOR, lenders and some steps that you can take to make the process easier for yourself, to get prequalified for a mortgage.

What is a prequalification? It's basically an explanation of your financial status so that lenders know where you stand financially before they approve your loan. To get a prequalification letter from a lender, and provide certain information about your income and debt situation are the beginning steps to homeownership.

So what should you do first? First thing's first: contact a REALTOR who has access to lenders to get a prequalification and ask the lender if they offer down payment assistance programs or have access to down payment programs! If they do, then go ahead and schedule an appointment with them today! If they don't have down payment programs seek a lender that does.