Many individuals aren’t conversant with the steps required in getting approved for a Home Mortgage in Portage MI. In most cases, they become interested when they hear news of interest rates dropping and reduction in prices of real estate.
Getting a home loan is different from other forms of loan and individuals should be able to recognize the differences. When lenders decline their home loan applications, they are often surprised and disappointed.
When individuals want to Apply for a mortgage loan, they should first educate themselves concerning the different processes involved in getting the loan approved. The following are factors to consider when applying for a mortgage loan.
Credit History
Surprisingly, some prospective home buyers do not review their credit scores and history before submitting a mortgage loan application. This is the first thing that lenders check, and a low credit score usually results in the application being declined.
Credit Score
Credit activity and scores play a major role in the approval of a home loan. Lenders require individuals to have a credit score of 670 or higher. In the case of FHA home loans, the credit score should be at least 620.
Additional Requirement
In addition to the above requirement, individuals should not have a history of missed payments, late payments, and other similar issues. Bills should be paid on time, and total debt should be reduced. It is advised that individuals clean up their credit history before applying for a mortgage loan.
Down Payment
Most mortgage loans require the individual to make a down payment. Applying for a home loan without this down payment is a sure way to get the application declined. Previously, many lenders approved home loans with zero down payment, but in recent times, they’ve become very cautious.
Elimination of PMI
It is advised that individuals have the cash to make a 10% down payment. Such payment shows commitment on the individual’s part and may fast track the approval of the home loan application. It reduces the mortgage balance to be paid and also helps to eliminate private mortgage insurance.
Individuals who are considering applying for a Home Mortgage in Portage MI should schedule an appointment. For more information and to make inquiries about services, visit the website.
