Preparing to Purchase
Plan ahead...
If you are planning to purchase a
home in the near future, begin now to make certain you'll be ready.
In addition to locating and saving the documents listed in our
Mortgage Application Document Checklist, you can prepare for the
home purchase process by doing the following:
Start saving!
If you're serious about purchasing
a home in the near future, accelerate your savings plan.
Demonstrating your ability to save and having extra funds on hand
will help you enormously in the approval process.
Pay all your
bills on time
Let's face it, some of us need
some work on our bookkeeping. However, the ability to demonstrate
that you are diligent about paying your bills on or before the due
date is important when applying for a mortgage loan. So be sure to
pay those bills on time! It will save you money on late fees too.
Save your pay
stubs
Begin saving all the stubs from
your pay checks from your employers. If these pay stubs are
computer-generated, they can, in many instances be used to verify
your income, without having to obtain documentation from your
employer.
Pay your rent
by check
Don't pay by cash, because
cancelled checks will be an important way to demonstrate that you
meet your housing expenses on time.
Save cancelled
checks
If your credit history needs
bolstering, the ability to demonstrate on-time payments to utility
companies, the telephone company, etc. will be important.
Save bank
statements
Bank statements showing deposits
and withdrawals will be needed to demonstrate funds for the
downpayment and funds to close. If you can provide lenders with
original statements, they may not have to wait for your bank to
verify the information when you apply for your mortgage, a process
that takes time.
Order a copy of
your credit report
Your mortgage loan officer can
help you with this process. By ordering your credit report in
advance of your purchase, you will have the opportunity to correct
errors on the report or close/satisfy accounts that may present a
problem when you are ready to apply for a loan. Too many open
accounts can be a detriment, even if you have a zero balance!
Consider
waiting on major purchases
Borderline mortgage applicants may
sabotage their own eligibility if they sign on for a large ongoing
debt (such as a car loan) just before applying for a mortgage. Your
loan officer can answer your questions on this.
Find a real
estate agent you are at ease with
Even if you are still in the
exploratory stages, you can ask a real estate agent to provide
information on the town in which you are interested. He or she can
usually give you information about the schools, taxes, price ranges
and town services. If your real estate agent understands that you
are working with a mortgage lender, he or she will know that you are
a serious buyer and will be happy to invest time in your home search
process. This is particularly true if you have been pre-qualified or
if you have a pre-approval loan commitment. Once you've found an
agent you like, stick with them! Through the multiple listing
service, they have access to almost every home listed for sale.
When you've found a possible home
or community that interests you:
-
Inquire with local government or
the realtor about possible buyer assistance programs that
community may offer (if needed)
-
Contact the County Assessor to
determine taxes and possible special assessments for the property
-
Possibly contact utility
companies to determine an average billing or usage for that
residence
-
Check neighborhood and area
amenities, proximity to points of interest, schools, churches, or
businesses
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