What Lenders Look For In Potential Borrowers
If you are working to secure a mortgage, you might be nervous about meeting with potential lenders. Will you be a fit for their criteria? Will you be able to get the loan you need? To help you answer yes to these questions, we offer the following tips.
- Check Your Credit Score: Did you know that federal law allows you to secure a free credit report once a year from Equifax, Experian, and TransUnion? Take advantage of it by doing your homework about your credit health before meeting with a mortgage lender.
- Lower Your Debt-To-Income Ratio: If your credit score is below 700, consider working to lower your debt-to-income ratio before heading to a lender’s office to improve your profile. This means aggressively paying off credit cards and outstanding loans.
- Save For A Down Payment: The lower the loan-to-value ratio on your mortgage, the more likely it is to be approved. The more you can put towards a down payment, the more likely you are to be able to pay your mortgage off without trouble and, consequently, the more likely lenders are to approve your loan.
- Evaluate Your Occupancy: If you only live in a home part time, your vested interest is considerably lower in the property than if you live in a home year round. Lenders know that, and see borrowers that will occupy their properties full-time as the lowest risk.
Does starting the home buying process feel overwhelming to you? If you are looking for a guide in the real estate market to help you get into the home of your dreams, do not hesitate to contact The Barr Team. Located in Irvine, our staff of expert agents is here to flawlessly meet all of your Southern California real estate needs. Call us today!