You’ve found your dream home and are looking forward to closing. A little planning can help you ensure that your loan experience goes as smoothly as possible. Follow these five guidelines to keep your loan process flowing as efficiently as possible.
Qualifying for Home Loan: Steps to Follow
- Get your paperwork in order
Before approving your loan, a lender needs a clear picture of your financial situation. When you apply, you’ll be asked to submit a number of financial documents, including pay stubs, bank statements and tax returns from previous years.
It’s a good idea to gather these documents before you apply so you can submit everything at once. We’ve assembled a checklist of documents needed for application to help you to collect the necessary documents and avoid unnecessary delays when qualifying for home loan.
- Explain irregular deposits
Not everyone’s income is easy to discern from pay stubs and tax returns. This can occur if a large part of your income comes from alternate sources like bonuses, freelance work or payments from stock options. If there’s something about your income that’s a bit irregular, include an explanation so that your lender understands your situation.
- Pay down debt
Lenders also consider your outstanding debt during the application process. They’ll look at how much you’re paying per month for car loans, student loans and credit card payments. They’ll also examine what percentage of your monthly income goes toward these payments. Paying off some of these accounts could help you qualify for a better rate on your mortgage loan. If you have the funds, this may be worth considering – but be sure to talk to your lender before paying down debt to fully understand your options and increase the chances of qualifying for home loan.
- Consult your mortgage banker before a major purchase
If you’re considering buying something sizeable – like a car, boat or another property – talk with your mortgage banker to ensure that it won’t affect the cost or processing of your mortgage loan. Having this conversation will enable you to discuss financing options and decide on the best timing of your purchase. In some cases, it makes sense to delay the purchase until after you’ve bought your new home.
- Communicate regularly with your mortgage banker
Your mortgage banker is there to guide you through the home loan process. If your mortgage banker requests missing information or supporting documents, try your best to send that information as soon as possible to avoid unnecessary delays when qualifying for home loan. It’s a good idea to remain in close communication throughout the process. If questions arise, don’t hesitate to give them a call.
By keeping these pointers in mind, you’ll be doing everything you can to make the mortgage process go smoothly and speed up the move into your new home. For more information on applying for a home loan, contact a mortgage banker at Carlyle Financial today.