Apply for a Mortgage: Before you take the plunge

2007-03-08 10:33:40

( Financial )



Now you are finally ready to make that big step towards home ownership and apply for a mortgage. However applying for a mortgage is not a walk in the park. While it is not difficult to get approval if you have all the proper financial documentation to back you up, there are several steps in the process that you have to accomplish first before you can actually apply for a mortgage and ensure fast approval.

THE CREDIT REPORT

The main consideration when you apply for mortgage is the credit report or rating. A credit report contains all your assets and liabilities as well as your household’s regular cash flow. When you apply for a mortgage, your credit report will be evaluated together with the appraised value of the property that you want to purchase. When the amount is enough to cover the mortgage that you want to take, then the lender approves the application.

In a nutshell, it is the credit report that measures your ability to pay your obligations. It can be the basis for refusal as well when you apply for a mortgage. Therefore, you have to make sure that your credit report is as accurate as possible because slight errors can be grounds for delay or outright denial.

THE PROPERTY IN QUESTION

Prior to applying for a mortgage, you must also have made the decision regarding which property to buy. The amount of mortgage that you will apply from a lender will be based on the value of the property you will buy.

Before approaching a lender to apply for a mortgage, make sure you have talked with the realtor and have all the pertinent information in hand such as the price of the house and the down payment required.

Moreover, make sure that you have checked first from the lender what other documents they would require before they can process your loan application. Prepare all of these requirements before going to the lender. Doing this saves you time and reflects on your character as a conscientious and diligent borrower.


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