Halloween has come and gone. It is time to take the fear out of the mortgage process! Many potential buyers are concerned about mortgage qualification and shy away from jumping into the Greenwood real estate market due to their uncertainty about the buying process. We want to make the process more understood and put those fears to rest!
In order to qualify for a mortgage in today's market, you'll need to have saved for a down payment (the average down payment was 11% last month, with many buyers putting down 3% or less), a stable income, and a good credit history. Throughout the home buying process, you will interact with several professionals who play important roles and will be great resources to you. Once you are ready to apply for a mortgage, there are 5 steps that Freddie Mac suggests you follow:
1. Find out your current credit history & credit score. Even if your credit is less than perfect, you may qualify for a loan. According to Ellie Mae, the average FICO score of all closed loans in September was 731.
2. Start gathering all of your documentation. You will need income verification (such as W-2 forms or tax returns), credit history, and assets (such as bank statements to verify your savings).
3. Contact a Professional. Your real estate agent can recommend a loan officer to help you develop a spending plan and determine what you can afford.
4. Consult with your lender. They will review your income, expenses, and financial goals to determine the type and amount of mortgage you qualify for.
5. Talk to your lender about pre-approval. A pre-approval letter provides an estimate of what you may be able to borrow and shows sellers that you are a series buyer.
By doing your research, reaching out to professionals, and making sure you are ready for the financial responsibility of owning your dream home in Greenwood, the mortgage process is much less scary. If you are considering becoming a homeowner and would like more information, contact us at (864) 341-7774 or email us at lakegreenwoodproperty@gmail.com.
