You'll hear many people say that loans are not available during these recessionary times. That's not true!
Home loans are READILY available with certain criteria.
According to the Federal Housing Administration (FHA), their pre-qualification essentials include:
* Having a steady employment history, at least two years with the same employer.
* Consistent or increasing income over the past two years.
* Credit report should be in good standing with less than two thirty day late payments in the past two years.
* Any bankruptcy on record must be at least two years old with good credit for the two consecutive years.
* Any foreclosure must be at least three years old with good credit for the past three years.
* Mortgage payment qualified for must be approximately 30 percent of your total monthly gross income.
Other lenders' ideas regarding pre-qualification are all similar to those outlined above. A mortgage lender will look at your credit report, earnings, debts, and savings in order to see how much home you really can afford.
Why is this important? In recent years there has been a “mortgage crisis,” where the industry was rampant with fraud and with loans that put homeowners into situations they could not afford. As payments rose, homeowners found themselves unable to meet their monthly obligations. According to Realtytrac.com and their U.S. Foreclosure Market Report, in January 2010, one in every 409 households in the country had received a foreclosure filing.
Since pre-qualification for a home loan typically costs you nothing, but gives you both a goal of what homes are in your affordability range, as well as how much money you should look to have saved for a downpayment, you can hardly wait to take this step.
During the pre-qualification process, you will be expected to provide the following information:
** Your gross monthly income
** Your total monthly payments (car payments, credit cards minimums, child support payments, student loan payments, any other monthly debts)
The lender will be looking to see that your debt to income is below about 40 percent, and the lower the better. So, if you are looking to buy in the near future, be sure to get "Pre-Qualified".
Contact your local Realtor Professional, who can give you the names of lenders who have very competitive rates.
Dianne Dunn and Team New Bern
Keller Williams Realty
New Bern, NC
Email Dianne!
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