7 Home Mortgage Tips to Know for Buying in Today's Market

7 Home Mortgage Tips to Know for Buying in Today's Market
  • Written on May 03, 2021 By Stanley Martin

We know how big this step feels and we’re here to help make the process as easy as possible. Now that you’ve identified a home you’re looking to buy, it’s time to get into the financial details. While there are no guarantees that you’ll qualify for the mortgage of your dreams, we’ve pulled together some tips to take to make your mortgage application as attractive as possible.

  1. DON’T wait to check your credit.The first thing lenders do when you apply for a mortgage loan is check your credit, so you should too. Review your credit report beforehand to make sure it is as accurate as possible. You can get a free copy of your credit report from each of the three credit bureaus, Experian, Equifax and TransUnion.
  2. DO fix any mistakes in your credit report. Don’t assume that all the information is accurate – banks make mistakes too. Carefully go through your credit report to see if there are any mistakesor inaccuracies that could be harmful to your credit score. Some important things to look out for include out of date information, incorrect notations for closed accounts and debts that have already been paid.
  3. DO have your documentation in order. When applying for a mortgage, you will need to have a well-documented account of your identity and expenses. Read through an online checklist to see all the items that you should have handy and organized before you walk into a lender’s office. We recommend starting with these documents: driver’s license, Social Security card, most recent tax returns, W-2s, pay stubs, marriage license and a contact number for your employer to confirm your employment status.
  4. DO get a mortgage pre-approval. If you can, we highly recommend being pre-approved before you even start looking for a home. It’ll not only help you understand what kind of budget you are working with and how much you feel comfortable borrowing before beginning the loan application process, but also show lenders you can meet the requirements for paying a loan. Check out a lender we work with, First Home Mortgage, to see what the loan pre-approval process looks like before you even start signing papers.
  5. DO pay down debt and avoid any new debt.You don’t need to have a perfect credit score to be approved for a mortgage loan, however, the less you owe your creditors, the better. Paying down your consumer debt before completing your application will lower your debt-to-income ratio and may help you get a better mortgage rate. Pay your bills on time and keep your credit card balances as low as possible. Make sure to keep current credit cards open – closing a card will increase your available credit and lower your score. Lastly, avoid any major purchases until after you’ve closed on the mortgage loan.
  6. DO explore your mortgage options.Go over mortgage options to ensure you are making the right choice for your lifestyle and financial obligations. Many home buyers decide on a 30-year fixed-rate mortgage, which is paid off in 30 years with an interest rate that stays the same. However, there are other options. A 15-year loan usually has a lower interest rate, but the monthly payments are larger. Read up on your options and talk with your mortgage lender to decide what works best for you.
  7. DON’T get discouraged. Home ownership is a huge responsibility and financial obligation. Your financial circumstances are subject to change, the economy is still in flux. Motivate yourself to improve your credit and finances by creating a realistic plan and sticking to it.

We hope these tips help you stay organized and improve your chances of getting a home mortgage!

Stanley Martin Homes has an affiliated business arrangement with First Heritage Mortgage, LLC and may benefit financially from use of its services. First Heritage Mortgage, LLC is an Equal Housing Lender | www.nmlsconsumeraccess.org | Fairfax, VA: Company NMLS ID# 86548