Buying a new home is one of the most exciting experiences a person or family can have. Of course, before you can step foot into your new dream home you will need to get prepared financially, especially if you are taking out a mortgage to cover some of the purchase price. Let’s take a look at a few key steps that will help you to prepare for the financial background checks that are part of the mortgage process.

Square Up With The Government

The first place you’ll want to start is making sure that you are fully caught up on any income or other taxes. Rest assured that your lender will be checking your financial history and being behind on government payments is a significant red flag. Make a quick call to the IRS or visit them online to check on your status and verify that you’re fully paid up.

Scrub Your Credit History Clean

Next, you will want to check in with the major credit reporting agencies to get a copy of your credit report. Your credit or FICO score is an important indicator that suggests your risk level and creditworthiness. However, any unpaid or delinquent amounts on your report are equally as important as they can signal that you may have skipped out on debts in the past. Check for any red flags on your credit report and work with the agencies to get them challenged or removed

Get Your Down Payment Saved Up

You’ll also want to have your down payment amount saved and ready for use. Your mortgage lender will want to know how much of your savings you’re contributing to the overall purchase price. Also, if you’re committing less than 20 percent down you may be required to purchase private mortgage insurance.

Have All Your Paperwork Ready

Finally, check in with your mortgage lender to find out what paperwork you’ll need to bring in for your approval meeting. Recent W-2 or tax returns, pay stubs and financial asset information is a good place to start. Your lender may have other requirements so check in to find out what’s needed or give us a call and we can share some insight.

These are just a few of the tasks that you’ll complete on the path to securing your mortgage financing and buying your new home. For more information on the mortgage process or to start your pre-approval, contact us today.

Are you in the market for a new house or apartment? If you are financing the purchase by taking out a mortgage, you’ll want to know how to make this transaction run as smooth as possible. In today’s article, we’ll share a quick four-step guide to speeding up the mortgage closing process.

Step #1: Check In On Your Credit Score

The first step before applying for your mortgage is to check in on your credit. Request a copy of your credit score and history from one of the major reporting firms. Go over this report, paying close attention to any old or outstanding items that you may have already dealt with. Many individuals have old delinquencies that must be challenged to be removed from the report, so take care of these first before applying.

Step #2: Have All Your Documents Prepared

As with any loan, taking out a mortgage requires a small mountain of paperwork. The best way to speed this process up is to have all of your financial documentation ready for inspection and use by the lender.

Note that each mortgage provider has different requirements for what you’ll need. A brief list of some items which are commonly requested includes your current employment details, recent pay stubs, recent W-2 forms or tax returns, proof of self-employment or other means of income, asset details such as bank accounts and investments and debt information such as other mortgages, student loans and more.

Step #3: Have An Offer Ready

If you have already settled on the home that you want to buy, it’s best to get your offer prepared in advance of being fully approved for mortgage financing. Your real estate agent will be able to help with crafting an offer that is subject to the home passing an inspection. It’s especially important to have an offer ready in the event that other buyers are competing for the same home that you are.

Step #4: Get The Inspection Finished Promptly

While your lender is completing the home appraisal process, you should be having the home inspected. Getting the inspection completed promptly will prevent any delays due to problem areas that might be uncovered. For example, a pest problem like termites may need to be dealt with, or minor repairs to the roof structure may need to be scheduled.

Following the steps above will help to ensure that your mortgage closing process goes as smoothly as possible. To learn more about your mortgage options or to get the pre-approval process started, contact us today. Our friendly mortgage professionals are happy to assist.