There are many people who are looking to buy a house and look to a mortgage lender such as a mortgage company to provide them with this. With a reputable mortgage lending institution these people can get sufficient funding that will allow them to achieve one of their top financial goals. Whenever you’re looking to get a mortgage, there are certain qualifications that you’ll need to keep in mind. These are qualifications that you’ll have to meet in order to get the financing you need. It’s important to be knowledgeable of the interest rates, the required down payment, income guidelines, and the required credit rating.
As an Eagan first time home buyer loan officer, one of the keys to qualifying for a mortgage is the down payment. This is the amount of money that you need to provide up front in order to get the mortgage financing. The down payment will usually be 20% of the purchase price. While this may be a bit high for some borrowers, there are some lenders and programs that allow you to get a mortgage for a lower amount. Programs such as FHA can enable you to get a mortgage with a down payment of less than 10%.
Another key to qualifying for a mortgage is the income of the borrower. Whenever you’re looking to get a mortgage, it’s important to have a certain income. In most cases, the mortgage will need to be no more than one quarter or 25% of your income. As a result, you will need to evaluate your financial situation before deciding to take on a mortgage. Borrowers who have a high debt to income ratio will need to pay off some outstanding debt before applying for a mortgage. This will help them avoid financial difficulties in the near future.
Whenever you’re applying for a mortgage, one of the things that a lender will evaluate is the credit rating. This is a numerical score that lenders use in order to evaluate your creditworthiness. It’s important to have a high score so that you’ll be able to get the lowest interest rates available. A credit score that’s above average can get you a mortgage at a rate of less than 4%. However, there are some programs that accommodate borrowers with lower credit scores such as FHA. Therefore, you can qualify for a mortgage if your credit score is no less than 580.
Anytime you get a mortgage, the interest rate is going to be a critical factor. This is an amount that you pay on top of the principal balance. A lower percentage will allow you to save money and allow you to have more affordable payments. Therefore, it’s a top priority to shop around for mortgages that offer you the lowest rates available. Fortunately for most prospective mortgage borrowers, the interest rates are at historic lows. As a result, you can get a mortgage today on very affordable terms.
Need help to prequalify for a mortgage loan? We're here to help! Ask about Eagan first time home buyer program.