Ever been at a store intending to make a purchase, only to realize you left your debit card at home? Yeah, we’ve been there, too. And we know it’s not a lot fun. In fact, there’s nothing much worse than wanting to buy something but being unprepared. This is particularly true with homebuying. Just imagine shopping around and finally finding the perfect home, only to realize you’re not going to qualify for a home loan. That would be pretty hard to stomach. Here’s the good news: While you may not know how to prepare for a mortgage, it’s actually pretty easy. Following are three ways you can be totally ready in this super-hot housing market—when there’s simply no time to waste once you’ve found “the one.”
1. Check your credit score (and raise it, if needed)
OK, so this one seems like a no-brainer, right? Then again, some people start looking for their next home without giving a lot of thought to their credit score and how they might improve it, if necessary. Raising your credit score isn’t rocket science. In fact, there are several practical, relatively easy ways to do it. Also note that you don’t have to have a perfect credit score to qualify for a home loan.
While a credit score of 760 or higher tends to help homebuyers get the best mortgage interest rates, you can qualify for a loan with a much lower credit score. Minimum credit score requirements vary depending on the type of loan you pursue, so check with your Fairway of the Carolinas mortgage advisor to find out the best loan for your credit situation. Knowing where you stand on credit is one of the biggest keys to being prepared to make a home purchase.
2. Save for a down payment and closing costs
Although you might be tempted to go out and purchase that luxury yacht you’ve always wanted, don’t do it. At least not right now. In order to make a good down payment and afford your closing costs, you’ll need as much cash on hand as possible. Plus, the fewer debts you have, the more likely you are to be approved for a loan. Just avoid the temptation to make any big purchases for right now. It won’t be this way forever. You’ll be glad you waited on that yacht once you’ve settled into your new home, and life is good.
3. Get a pre-approval
If you want a leg up on securing a home loan, a pre-approval is the way to go. This written letter confirming your financial readiness to handle a home mortgage loan is arguably your No. 1 ticket to being prepared for a mortgage. Along with making you more attractive to the seller, it will empower you to make a good offer in a short amount of time. In addition, a pre-approval lets you know how much home you can afford. Our loan officers at Fairway of the Carolinas are always ready to provide you with a fast pre-approval, so contact us today to get the ball rolling.
How to prepare for a mortgage: The bottom line
While these are all important ways to prepare for a mortgage, they aren’t the only ways. This is why it’s important to connect with a trusted mortgage advisor. He or she can help ensure sure you’re not overlooking anything that could impede your ability to make a good offer. Ultimately, our goal at Fairway of the Carolinas is to guarantee you’re completely ready to make an offer and don’t get left in the dust by more qualified buyers. We want to make you a prepared buyer and walk you through the homebuying process with ease. Along the way, we’ll also answer any questions you have. Feel free to leave questions in the comment section below or contact us whenever you’re ready.