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Best Mortgage Tips for the First-Time Homebuyer Taking a mortgage is no doubt a major commitment. It’s therefore important that you find the best deal possible if you are a first time home buyer. To get approved and qualify for a decent rate, you will need to be in good shape, financially speaking. This means that you must be aware of certain things before you can arrange for the mortgage. Here are some tips that can help you secure the best mortgage possible: Have a financial plan It’s important to take a bit of time to plan your finances before applying for the mortgage. To begin with, consider whether you’ll be able to afford paying back the amount you’re borrowing.To begin with consider whether you’re going to afford to pay back the amount you want to borrow. Secondly, you’ll need to make sure that the money you’re borrowing will be enough to buy the property, with some more left to take care of associated fees. Do you expect to have any problems with the monthly repayments. You’ll need a mortgage calculator to work out the numbers so you can be adequately prepared before approaching a lender.
Smart Ideas: Lenders Revisited
Clean up your credit
Smart Ideas: Lenders Revisited
Your credit score and credit history are among the factors your lender will consider when assessing how much of a risk you are. Before you apply for the mortgage, therefore, you’ll want to take a look at your credit report. The last thing the lender wants to see is that you have credit cards with huge balances. So pay off your debts, or at least try to keep your balances to a minimum. Not having any outstanding loans, such as when you’re financing a new car, also helps. Having good credit shows your lender that you’re capable of managing your finances well, which increases your chances of getting approved. Consider length of the loan This is definitely of one of the most important considerations. While you may get a lower interest rate with a 15-year mortgage, the monthly payments will be bigger than having the repayment period stretched over 15 more years. Taking a shorter-term mortgage would be a good idea if you can afford the large monthly payments. Job stability is important Since most lenders need to see that you’ve been in a certain job for some time, having a stable job helps. So if you’re thinking about changing jobs, you may want to secure the mortgage first before you proceed. Most lenders will only consider applicants who’ve been in their current jobs for a minimum of 3 – 6 months. Remember that one of the things they’ll need is proof of income. That means obtaining the necessary documents from your employer. You might also need to provide pay slips and bank statements of the last three months so the lender can examine your earning and spending patterns.