If you have begun the search for your dream home then it’s also likely that you have started your search for the dream mortgage, too. And as anybody who has ever been through the mortgage application process will tell you, it’s important that you take steps to prepare yourself and your information to make the best impression possible.
After all, the person you are meeting is going to determine whether you will be approved a mortgage and the rate which you would be offered.
Know the Bad Stuff First
Any reputable lender is going to check your credit score and the associated report. That’s just a given. However, watching them scrutinize over your report shouldn’t be the first time that you have seen it.
Before your meeting, obtain your own copy of your credit report and make sure that it accurately reflects your financial history and situation. For example, check for the following flags:
- Your name spelled incorrectly
- An address you never lived at
- A line of credit you never took out
- Debts which aren’t yours
Any of the above can be an indication of fraud and should be resolved immediately. If it left on your report then it will negatively affect your credit score and lending power. Not to mention having to explain yourself during your meeting
What’s Your Current Position?
Simply giving your mortgage lender an approximate figure for how much disposable income you have each month and the amount of credit debt you have isn’t going to cut it. In fact, it will send a very bad message that you aren’t prepared. Instead, sit down and formalize your incomes and expenses, making sure to include all of each. This doesn’t mean showing your mortgage lender how much you spend and save at the Groupon Coupons page for Medifast, but it does mean an itemised list of grouped expenses and debts.
To help substantiate your position, take the following documentation with you:
- Statements which display your savings history
- Pay information/stubs/receipts
- Letters from your employers outlining your employment history and current standing
- All statements relating to debts or financial obligations
Each lender will have their own further requirements, however, the items above are enough to get the ball rolling, allowing you to provide further requested information in due course.
Remember that there is no rush when it comes to taking on a mortgage. If, after assessing your current financial position, you aren’t confident that you can comfortably take on the financial burden of a mortgage then your best choice is to cancel the appointment and wait until your finances are in a better and more stable position.
There is a reason why your friends and family didn’t tell you that the mortgage process was easy, however, there’s also a reason why they were able to navigate through it – because you can! You just need a little bit of help, such as the tips in this article, to keep you on the right track.