Are You Applying For Your First Mortgage Loan? Learn What To Expect
There are several simple ways to avoid an outright denial of your mortgage loan application
Unfamiliar things and processes can cause a lot of stress for many people. This is normal and most people get nervous when they try out new things. This is particularly true when you apply for your first mortgage loan. Do not get too anxious though because most homebuyers, even those who have previously applied for home loans, also get nervous during the application process. They usually get nervous because they think that qualifying for a new loan would be difficult. You will probably experience some anxious moments especially if you do not know what mortgage lenders are looking for.
So the key to have an easier time during the mortgage loan application process is to know what lenders would be looking for. Knowing right information that you need to provide will make the process a bit less stressful.
Four Crucial Points Lenders Always Consider
There are four key points that all mortgage lenders consider during the mortgage loan application process. These are:
- Property information
- Income history
- Credit score
These four factors are considered in the industry as the four major pillars that all home mortgages are built.
As a golden rule, most lenders would want you to have good scores on all four aspects. However, they are not really expecting you to get superiorly excellent scores on all fronts. Lenders know that there are so many economic factors that can affect your ratings.
First of all, all mortgage lenders will require you to produce documentations on these four areas. So you have to submit your pay stubs or income history, W-2 for at least two years, and banking statement for the past three months. You will also be required to submit other relevant documents that may include bankruptcy information, divorce papers if you have one, and certification of self-employment if you are self-employed. You need to prepare these documents and submit them promptly to your lender so that your application can be processed immediately.
How to Avoid a Denial
There are several simple ways to avoid an outright denial of your first mortgage loan application. First, you have to give all the information and documents required by the lender. Never indicate a protest whenever you get a request from the lender to get more information.
As much as possible, do not apply for new credit cards during the mortgage loan application process. And never rack up new debts because these could result to outright disapproval of your application. It is also not the best time to get a new job. Wait for the loan to close before you look for new employers. Lastly, make sure that you are only applying for a loan that you can easily afford. Never get a loan that is way beyond your capacity to pay so that you can get an easy approval from your lender.
It is expected that you will feel some form of nervousness when you first apply for mortgage loan. To enjoy hassle-free and stress free application process, you need to know the things that mortgage lenders want from you. Get to know these things and enjoy quick approval for your mortgage loan application.
About the Author
Rob K. Blake, home loan expert and author, educates mortgage shoppers on finding local providers by state like Massachusetts Mortgage Brokers and Lenders and provides reviews of national companies like Asset Acceptance Capital Corp. http://themortgageinsider.net