Reasons to Consider Debt Consolidation
It is possible to have a difficult time trying to figure out how to get a mortgage when considering getting your own property. The major housing crisis that occurred a couple of years ago has made the lenders become strict on the people they now give loans to.
The first thing to do is knowing about your monthly debt obligations. Take the time to document all the debt payments and your monthly income. Your lender will ask you to provide two weeks of pay stubs for them to verify your income. The whole process will be harder if you have more than two sources of income or if you are self-employed. The lender will need to determine if you can pay the mortgage payment before they approve it. You will get limitations to the limit the loan can be approved for if you have large debts to pay. The best thing for you to do is pay these debts off before you can apply for the mortgage.
When thinking of getting a mortgage, you will first need to check your credit health. You need to have a copy of your credit history and your recent credit score. Ensure your report does not have any errors or negative marks like making late payments. When you have a low credit score, it will be vital for you to have a cosigner who is qualified. You can also choose to wait until you have improved your credit score before you get the mortgage. Keep away from applying for new credit some months before applying for the mortgage.
It is also crucial for you to make the decision on the mortgage budget. Before you can go to the lender, you should decide the amount you can afford comfortably for a house. You should sit down and calculate the total amount you will need for your home together with the taxes and insurance added. It will be best to have an amount that is less than 35% of your total gross income. Getting property not more than 25% of your gross income is the best thing for you to do.
It is also good to decide the amount you will save for a down payment. When you have analyzed the credit and worked on your budget, you will then need to work ion your down payment. Be aware that the real estate agents are there to convince you on getting more house than what you actually need. You may also find that you are facing the temptation on your own. You should make sure you only go for the payment you will manage to pay when your financial state is either good or bad.