Buying a house can be difficult, especially for a first-timer with no assistance. Applying for a mortgage loan can be harder than finding a new home. There is lots of paperwork required to submit. A single mistake may cost you an approval to buy your new home. With some idea of what you should do, you will be able to get your dream house with minimal straining.
Plan ahead by saving for the down payments and any extra costs you may incur when finding and paying for your new house. Lenders require an average of two months or 20 % percent of the repayment when they approve a mortgage request. Start by saving early so you can have the money ready to avoid any extra costs. Ask around in banks and mortgage companies to have an idea of how much down payment you may require.
Once you decide on your price range, check on your documentation to make sure everything s is ok. Make sure your credit card score is as high as possible. Settle all the loans and problems that may appear on your credit report. Errors and disputed in your credit may hinder you from getting an approval from lending companies.
Home buyers tend to look for a home first and then start pursuing the loan later. Don’t make this mistake. If you have enough money to pay up-front, this may not be a problem for you. Many buyers are afraid the lenders will disqualify them from getting a loan or give them a loan that is lower than they expected. The advantage of shopping for a loan first is you can try several places until you find a lender that is willing to loan you an amount that is within your budget. Once you get prequalified, shopping for a home will be easier and less stressful.
Get professional help when looking for a home. Find a good and affordable real estate agency, a loan officer and a lawyer. Buying a home without professional help may not be a good idea. Ask for referrals from friends, family and workmates to find professional help familiar to the people around you so you know what to expect. A good realtor should be able to find you a nice home with minimal defects. Make sure you tour several houses. When you find one you like, do a thorough inspection to double check on the standard of the house.
Don’t look for homes that cost more than what you were preapproved for. The total cost of the house, its maintenance and renovation should sum up to the mortgage and some of your savings. Don’t spend all your savings on the down payments, save up a few extra thousand pounds in case of any emergencies.
Avoid getting another loan before you close the deal or pay off that mortgage. Getting another loan before paying for the house may have your mortgage approval withdrawn. Lenders always check your credit report to make sure your financial situation has not changed.