Obtaining a home loan isn’t a one-step process. Below we’ve laid out the most essential aspects of the home loan process. Our guide will help you be prepared for every step of the way!
Save Up for a Down Payment
The home loan process always starts with saving. Depending on the type of loan you choose, you may be required to make a down payment ranging from 2.25% to 20% of the purchase price of the home. Start by creating some room in your monthly budget for the down payment. The most convenient method is establishing an automatic deposit to a savings account, specifically for your home loan. If a large down payment isn’t realistic for you, consider an FHA loan. This loan program is designed for home buyers who can only make small down payments.
Track Your Credit Score
Having a good credit score makes the home buying process a breeze! Before you start the buying process, get a copy of your credit report. Looking at your report will help you understand how your credit profile appears to potential lenders. Once you’ve examined your credit profile, you can begin taking steps to improve your credit score if need be.
Get Organized & Prepared
When you submit your mortgage application, you’ll need to hand over a few important financial documents to your lender. Take some time to get organized and find all the records you need to provide your lender. Having these documents at the ready will accelerate the processing of your loan application. In most cases, you’ll need to provide your last two pay stubs, your previous two tax returns, your most recent W-2 form, and current bank statement.
Discover Which Loan Option is Best For You
Despite their sound advice, the loan program that worked best for your parents may not always be ideal for you. Take some time to research which loan program will fit with your current financial situation. Everyone has a set of unique financial needs. With a little digging, you’ll be able to find the loan that best suits your needs.
Contact a Lender
Once you’ve done all your research and assembled the necessary documents, it’s time to visit your lender. They’ll be able to assist you with all the heavy lifting involved in the mortgage process.
At Assurance Financial, we guide each of our clients through the home loan process, ensuring total transparency and support along the way. Our team of mortgage experts specialize in residential home loans and are here to help you. For more about our loan process, click here.