Today I want to talk about mortgage financing. This is the first and most important step you will take in starting your home buying journey. This step is best taken in advance of your home purchase to make sure there are no unforseen issues on your credit report.
What is a mortgage?
A mortgage is a legal instrument to secure financing for a home with a promise to pay the loan back. Its just like any other loan but much better because of the tax benefits, such as the mortgage interest deduction which can save you money on your taxes.
So how do you get a mortgage?
The only way to truly know if you qualify for a loan is to talk to a lender.
They will pull your credit and ask you questions about your income and debt.
You will then have to provide financial documentation such as tax returns, W-2's, bank statements and other documents as needed.
It may seem intrusive but they are giving you a lot of money and they want to make sure you can pay it back.
Once you take the previous steps the lender will find you the best loan program for you. This includes first time home buyer programs, lowest interest rate etc.
Remember you will need a down payment unless you qualify for one of the first time home buyer programs or VA Loan...
The lowest down payment is 3.5% of the purchase price of the home. So if the home is $200,000 then the down payment would be $7,500.
Your lender will be the best to answer in more detail.
We would be happy to talk with you further and refer you to one of the great lenders we have worked with.
CONTACT US (505) 350-8184