5 Quick Tips About Home Loans
Very few people can afford to purchase a home without the help of a mortgage loan, so getting a home loan is often one of the biggest components of buying a home at the Lake of the Ozarks. The type of loan your qualify for and the size of the loan you can be approved for are largely responsible for dictating which home you will be able to buy. Gattermeir Davidson Real Estate is here to help you simplify the process with these five quick tips about home loans.
1. Loans Are Not "One Size Fits All"
Home loans come in many different shapes and sizes. Some loans have fixed interest rates, some have adjustable rates. Some loans require a minimum 5% down payment, others require more or less. Most home loans span thirty years, but others only cover fifteen or twenty years. An experienced mortgage lender will be able to help you determine which type of loan will be best suited for you and your needs.
2. Loan Amounts Depend Greatly On Your Credit Score
Your credit report is a number used to indicate your financial responsibility. Higher numbers are earned by making smart financial decisions and paying off your debt on time. The amount of loan you will be approved for (and the interest rate you will have on your loan) will be based off of your credit score. Higher numbers will give you access to greater loan amounts and lower interest rates.
3. There Are Conventional Loans And Non-Conventional Loans
Home loan applicants can choose between two types of loans: conventional and non-conventional. Conventional loans typically have certain requirements their applicants must meet, such as higher income levels and the ability to provide 5%-20% down payments. Non-conventional loans are generally given to people who do not meet the requirements for conventional loans. Non-conventional loans are backed by three independent agencies: the U.S. Department of Veterans Affairs, the Federal Housing Administration, and the U.S. Department of Agriculture.
4. Loan Pre-Qualification Is Not The Same Thing As Loan Pre-Approval
There are several steps in the loan approval process, the first of which is pre-qualification. For this step, the buyers discuss their financial assets, incomes, and debts with a lender who can then give them an idea of the type of home loan that will best suit their needs. The next step is pre-approval, wherein the lender conducts a thorough investigation of the buyers' credit history and verifies their income and debt information. By the end of the pre-approval process, the buyers should have a statement in writing saying they have been pre-approved for a specific home loan amount.
5. Loan Pre-Approval Requires Your Official Financial Documents
If you're looking to get pre-approved for a home loan in the near future, you can simplify the process immensely by gathering your official financial documentation ahead of time. In order to be pre-approved for a loan, the lender must investigate your income, debts, and credit history. At the very least, most lenders require the last two years of your tax returns, your recent W-2, last two pay stubs, and current bank statements. Preparing these documents in advance will help your pre-approval process go much more quickly and efficiently.
If you're considering buying a Lake of the Ozarks home in the near future, we strongly recommend you begin working with a lender to get pre-approved for a home loan sooner rather than later. As experienced real estate professionals at the Lake, we have seen many hopeful buyers fall in love with a home before getting pre-approved, which can create a lot of unnecessary stress for everyone involved. Beginning the pre-approval process before touring homes will not only ease the stress of the approval process - it will also give you a better, more concrete understanding of the type of home you will be able to afford.
Questions? The team at Gattermeir Davidson would be happy to try to answer them for you! Give us a call today. (877) 870-5253
NOW is the perfect time to buy a Lake of the Ozarks condo or home. For real estate at Lake of the Ozarks, contact the Gattermeir Davidson team. We feature lakefront homes, condos, lake lots, and commercial real estate at Lake of the Ozarks. For more information on our properties in the Lake of the Ozarks area stop by our office near Bagnell Dam in Lake Ozark or call us toll free 877-870-5253.
Stay connected with Gattermeir Davidson Real Estate, LLC
1. Loans Are Not "One Size Fits All"
Home loans come in many different shapes and sizes. Some loans have fixed interest rates, some have adjustable rates. Some loans require a minimum 5% down payment, others require more or less. Most home loans span thirty years, but others only cover fifteen or twenty years. An experienced mortgage lender will be able to help you determine which type of loan will be best suited for you and your needs.
2. Loan Amounts Depend Greatly On Your Credit Score
Your credit report is a number used to indicate your financial responsibility. Higher numbers are earned by making smart financial decisions and paying off your debt on time. The amount of loan you will be approved for (and the interest rate you will have on your loan) will be based off of your credit score. Higher numbers will give you access to greater loan amounts and lower interest rates.
3. There Are Conventional Loans And Non-Conventional Loans
Home loan applicants can choose between two types of loans: conventional and non-conventional. Conventional loans typically have certain requirements their applicants must meet, such as higher income levels and the ability to provide 5%-20% down payments. Non-conventional loans are generally given to people who do not meet the requirements for conventional loans. Non-conventional loans are backed by three independent agencies: the U.S. Department of Veterans Affairs, the Federal Housing Administration, and the U.S. Department of Agriculture.
4. Loan Pre-Qualification Is Not The Same Thing As Loan Pre-Approval
There are several steps in the loan approval process, the first of which is pre-qualification. For this step, the buyers discuss their financial assets, incomes, and debts with a lender who can then give them an idea of the type of home loan that will best suit their needs. The next step is pre-approval, wherein the lender conducts a thorough investigation of the buyers' credit history and verifies their income and debt information. By the end of the pre-approval process, the buyers should have a statement in writing saying they have been pre-approved for a specific home loan amount.
5. Loan Pre-Approval Requires Your Official Financial DocumentsIf you're looking to get pre-approved for a home loan in the near future, you can simplify the process immensely by gathering your official financial documentation ahead of time. In order to be pre-approved for a loan, the lender must investigate your income, debts, and credit history. At the very least, most lenders require the last two years of your tax returns, your recent W-2, last two pay stubs, and current bank statements. Preparing these documents in advance will help your pre-approval process go much more quickly and efficiently.
If you're considering buying a Lake of the Ozarks home in the near future, we strongly recommend you begin working with a lender to get pre-approved for a home loan sooner rather than later. As experienced real estate professionals at the Lake, we have seen many hopeful buyers fall in love with a home before getting pre-approved, which can create a lot of unnecessary stress for everyone involved. Beginning the pre-approval process before touring homes will not only ease the stress of the approval process - it will also give you a better, more concrete understanding of the type of home you will be able to afford.
Questions? The team at Gattermeir Davidson would be happy to try to answer them for you! Give us a call today. (877) 870-5253
NOW is the perfect time to buy a Lake of the Ozarks condo or home. For real estate at Lake of the Ozarks, contact the Gattermeir Davidson team. We feature lakefront homes, condos, lake lots, and commercial real estate at Lake of the Ozarks. For more information on our properties in the Lake of the Ozarks area stop by our office near Bagnell Dam in Lake Ozark or call us toll free 877-870-5253.
Stay connected with Gattermeir Davidson Real Estate, LLC
2011 REALTOR Salesperson of the Year
Missouri Association of Realtors
Gattermeir Davidson Real Estate, LLC
752 Bagnell Dam Blvd., Suite A
Lake Ozark, MO 65049
Office | 573.365.1555
Fax | 573.365.1766
Mobile | 573.746.0133
You're absolutely right: loans are not the same for everyone. Many people think they should be able to just walk into a bank and demand the same rates that their friends got, but there are so many factors at play. It's important to know that there are many factors to consider in the process of qualifying for a loan. After everything is said and done, it's actually a very good thing that loans are more customized - it ensures that you get exactly what you need. Thanks for your thoughts! http://darkhorsefinancial.com.au/home-loans/
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