As a first time buyer, mortgage can be a little bit confusing. There seem to be a lot of factors and aspects to think about and we know nothing about it. Here are several tips to make it easier.
#1. Reduce Debt Weight
Some of us may already have some debts at the bank. Let us start earlier in reducing the amount so the next mortgage will be easier for us to pay.
#2. Save for Down Payment
We need to allocate enough fund for down payment, and it takes time. Spend at least six months earlier to make saving or adjust as our capability.
#3. Shop Around for Terms
There will be many providers of mortgage. We need to shop around first and compare between terms. Some we find nice may not be suitable. So find the most suitable one.
#4. Get the Pre Approval
There will be a letter showing the amount of loan we deserve, our monthly payment, and the evaluation of lender. It gives picture if we have the ability.
#5. Get the Pre Qualification
It follows the pre approval. We verbally discuss the possibility with lender based on the financial information we both have to ensure that we can afford it.
#6. Search the Right Property
The pre approval gives a clue on how much we can afford for a property. We must look based on this financial situation and not going too much.
#7. Get the Entire Documents
When we are ready to make the process, we should gather the entire document first. It makes the process a lot faster and easier and there will be less risk of failure.
#8. Credit Score
You can get better deal on your mortgage when you have good credit score. Check it early so we have enough time for improvement if it is needed.
#9. Identify Asset and Liability
We need to be sure on our capability. How much will we spend and pay monthly? How much money do we have? We still need balance cash flow.
#10. Do Everything Right
If we do not have problems, and our records are clean, lenders will like us and make the process easier. We may also get better deal on mortgage.
The point is to show that we deserve the mortgage and that we are able to make good deal until the end. Those tips are effective but it takes time to succeed. Good luck!
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