Mortgage Basics I Need to Know

I am very new to this whole mortgage thing and I dont know anything. What are the basics I need to know? (suggestions on where to start, what qualifications mortgage companies look for, what i need to look for or what i need)

3 Answers

First, where do you live?  Do you have any idea as to the value of your home?  What is the current balance of any loans secured by your property?   You will need to provide employment and income information in order for the mortgage company to determine your ability to repay the mortgage.  Your credit will be reviewed to determine as to whether or not you qualify for the loan.  The lender will then run specific housing ratios to determine your overall ability to qualify.

It sounds like you are a first time home buyer looking for some guidance on how to be approved to purchase a home. If that is inaccurate please restate your question.

Lenders come in all types and sizes and while most use the same criteria not all lenders are the same. So a good starting point is to call two Real Estate offices in your town and ask for referrals to the top two or three loan officers in the area. Once you have this information contact the lenders and ask if they can give you some general guidance.

In brief, you should be prepared to discuss your income over the last two years. In addition, any major credit issues that you are aware of that could cause a problem like a bankruptcy or numerous collection accounts. The lenders will generally ask you to have your last two years of tax returns, w-2's or 1099's, last two months of bankstatements and some evidence of your year to date income (from january 1st to now). The lenders can give you a general idea. BUT in order to give you a true approval they will have to pull your credit report and credit score. This is done because almost all loans and interest rates are determined by the credit score.

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