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David Hay's Blog

By First Financial Services, Inc. | Mortgage Broker
or Lender in Charlotte, NC

Tips For Getting A Mortgage In Today's Housing Market

First Financial Services, Inc.


You’re in the market for a new home and you’re watching rates rise and housing prices right along with it. Should you stay on the fence or should you move forward full steam ahead? This is a question a lot of people are asking themselves right now.

The markets volatility can certainly cause some uncertainty for borrowers but the good news is, rates are still extremely low and along with this, home prices are still much lower than they were even 4-5 years ago in several markets across the U.S.

In addition to this, lenders have opened up their restrictions that have been in place since the housing market crash allowing many qualified borrowers to indeed accomplish the American dream and become homeowners themselves. Although preferred, you do not need to have 20 percent down, which was a requirement not too long ago. And a great credit score (720 or above) is indeed what lenders like to see, they can work with borrowers whose credit falls lower than this.

So if you indeed find yourself in this situation and are waffling back and forth on whether not to go through with a home purchase here are some tips:

Improve your credit score – Credit is a really big deal in the eyes of a lender so if your credit isn’t where it should be, partner with a trusted lender and do what you can to improve it. A lender will offer you advice on how you can take the right steps to raise your credit score, which will make a huge difference in interest rate you qualify for and the types of loans available to you when you go to borrow.

Don’t open any more credit cards – Unless you are brand new to the world of credit, do not open up any more credit cards when you are on the hunt for a new loan. Applying for credit shortly before applying for a loan can pull your credit score down, which can impact the rate you qualify for.

Put more money down – although you may not have the coveted 20 percent down payment, the more you can put down, the better you look to a lender. This approach will also help those who don’t have stellar credit. If you have more money to put down and just an average credit score, you may find yourself with a great loan that has a great rate.

Pay down your debt – Debt-to-income ratio is important to lenders so if you have a lot of debt, you’re going to want to get that under control if you want to qualify for the best loan. Your monthly mortgage payment, including principle, interest, taxes and insurance, along with any other debt you have should no greater than 36 percent of your gross monthly income.

Give yourself more time than you think – If you are working on improving your credit and saving for a good down payment, give yourself more time than you think. Credit reports errors and improvements can be seen as quickly as 30 days but depending on your circumstances, this may take much longer.

When you’re ready to get your home buying process started, be sure to contact a lender that you trust.  Click here to complete our short application. 


By Maria Batista,  Thu Sep 5 2013, 12:26
very informative!

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