As you prepare for homeownership, it is beneficial to become familiar with requirements necessary to qualify for a mortgage.
Mortgage payments are paid over an extended period and give potential homeowners the ability to find and pay for the home of their dreams. Knowing how to qualify for a mortgage allows you to line everything up to get the funds needed for your desired home.
Even though potential homeowners of all income levels can apply for a mortgage, a few key financial factors can make or break your mortgage loan qualification.
Having a well balanced debt to income ratio demonstrates you have enough funds after paying off monthly debts such as credit card payments, to comfortably afford a mortgage. A ratio of 36 percent or lower is considered most ideal to lenders.
Next, your gross monthly income should be steady and expected to be received for at least the next 3 or more years to demonstrate financial stability. This too demonstrates to lenders you can afford a monthly mortgage payment.
Sometimes, to qualify for mortgage approval, lenders require the loan borrower to put down collateral that can be seized if the loan is not paid back in terms of the mortgage contract. For mortgage loans, the collateral would be the home itself.
As you prepare to apply for a loan, it’s essential to manage your debt which boosts your credit history in the eyes of lenders. Your new home is a large asset, so before applying for a mortgage, consider speaking with a lender near you to answer any questions you may have.
I've been listing and selling in Wilmington and surrounding areas since 1987 and have been affiliated with Fudge Properties since 2007. I have a strong reputation for outstanding quality of both work and interpersonal relationships, knowing what needs to be done and how to elicit cooperation for getting it done. I'm also proficient and knowledgeable about the Mass Housing program guidelines, successfully completing numerous housing lotteries for first time home buyers, over 55 buyers and renters. Whether you're buying or selling, I can help you get the best deal. Just looking? That's OK. Use my website all you like, but you'll have to create a free account to unlock all the best search features. Once you sign up, you'll be able to save listings, save your search criteria, get automated email updates for new homes matching your saved search criteria, and more. Good luck on your house hunt! I hope to hear from you soon.
