Getting approved for a mortgage is of the most important steps to make it possible for you to buy a home, because many people need financing for such a big purchase. Even though it might sound like a daunting task to apply for a home loan, there are several things that you can do to make it easier. Here are a few steps to keep in mind:
Focus on Your Credit Score
Your credit score matters, because it will have a direct impact on your approval. When you are thinking about buying a home, check your credit score and start taking steps to improve your score. This number can be improved by closing a few unused credit cards, paying off debts, and staying current with all payments and bills. A higher credit score usually results in a better interest rate on your mortgage, so it’s worth the effort to improve your score.
Pull Together Financial Documents
During the mortgage approval process, the lender will ask for many financial documents. Instead of waiting until the last minute to gather these things, you can look for the paperwork in advance to save yourself the stress later on. These are some of the papers that you will need:
- A detailed list of all debts, such as car loans, student loans, credit cards, etc.
- Statements showing the value of all assets, including investments, mutual funds, and savings accounts
- Bank statements for the past 2 months
- Two pay stubs showing your income and paycheck deductions
- W2s or tax returns for two years
Once these papers are gathered, you can submit them to the lender at the beginning of the mortgage application process.
Complete Pre-Qualification Requirements
Even though it might seem like a hassle to get pre-qualified for a loan, it is very important that you do this step before you start looking at homes. Pre-qualification will help you to know how big of a loan you will be able to qualify for. So, you can talk with your real estate agent about your price range, in order to find a property that matches your budget.
Additionally, pre-qualification is beneficial to speed up the process when you find a home that you would like to purchase. Since the lender has already completed a few of the approval steps, you can get the financing faster. Keep in mind that there is a difference between pre-qualification and pre-approval, so talk with your lender to learn more.
When you are working with a trusted real estate agent, you will see that it is easier than ever to buy a home! At Duffy Realty of Atlanta, we are here to help. Our team knows the Atlanta real estate market, and we want to help you find the home of your dreams. For more information about buying a home, we invite you to contact us today: (678) 318-1700