6 Home Mortgage Tips for the First-Time Buyer
Monday, July 27, 2015, 6:00 AM | Leave Comment
Shopping for a home can be a long and taxing experience. By paying heed to the following six tips, the average first-time buyer can save significant amounts of money, time and distress throughout the entire home buying process.
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Beware of Online Scams
Today, the Internet is replete with fraudulent “lowest mortgage rate” offers. The perpetrators of these scams ask for and often get personal information from rate shoppers.
Invariably, this information gets passed onto marketing companies who sell them as leads to pushy mortgage origination firms. Don’t supply personal information to online entities you don’t know.
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Save Your Paycheck Stubs
Although mortgage loan processors have ways to electronically verify your income, this does not mean that you should toss out your paper paycheck stubs.
There is valuable information on them including salary history and your year-to-date earnings figures. Some employers are slow at providing banks with salary information; therefore, it’s a good idea to hold onto six months’ worth of pay stubs. Your lender will appreciate it.
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Document Your Assets
Your mortgage lender will want to pin down every penny of your personal assets during the underwriting process.
Do yourself a big favor and don’t permit any large (oversize) amounts of money to move either into or out of your deposit accounts during the three- to-six month period prior to applying for a mortgage.
You don’t want to give your lender the impressing that you’re using borrowed funds to make your down payment.
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Consider a Government-Backed Loan
The U.S. Veteran’s Administration (VA) exists to help service members, veterans, and eligible surviving spouses become homeowners.
Part of this assistance includes making home loan guaranties for housing programs. VA loans are provided by private lenders who rely upon VA backstops to secure a portion of these loan balances.
Despite the many benefits, no more than 15 percent of all eligible veterans actually utilize the VA to secure home loan financing according to the mortgage loan specialists at Low VA Rates.
For eligible veterans and service members, the VA is a great place to begin that journey down the road to home ownership.
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Schools Matter
According to real estate expert Brendon DeSimone, the school system in which your future home is situated needs to be a factor in your decision-making process.
This is so because the school district you’re in will have a big influence on your real estate taxes, your home’s future marketability and it’s ultimate resale value.
Your goal should be to live in the best school system you can afford.
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Document Your Rental History
If you never had a mortgage, you don’t have a mortgage history that your lender can analyze. For them, the next best thing is your rental payment history.
To this end, it is in your best interest to make sure that every single rent payment you make during that twelve month period before you apply for a home loan is made on time.
Further to this, you will want to make sure that at the time of application, you can produce legible copies of cancelled checks (or the equivalent) proving that your last twelve rent payments were made on time.
Armed with nothing but the above tips and an honest effort at understanding the full range of your borrowing options, the first-time buyer can proudly look forward to settling into a new home with very manageable mortgage payments.
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Rachelle Wilber is a freelance writer living in the San Diego, California area. She graduated from San Diego State University with her Bachelor’s Degree in Journalism and Media Studies. She tries to find an interest in all topics and themes, which prompts her writing. When she isn’t on her porch writing in the sun, you can find her shopping, at the beach, or at the gym. Follow her on twitter: @RachelleWilber
