Amazing Tips And Strategies For Getting Home Loan Approval
Taking a look at the ins and outs of home loan approval and how to best set yourself up for success. How to make sure you secure funding for your home.
First-time homebuyers make up close to half of the market share of all homebuyers. However, one thing that holds many would-be first-timers back is the difficult process of getting home loan approval.
In fact, even if you’ve bought a home before, you might still struggle with getting home loan approval. Past financial issues or credit score problems can make it hard to get approved for the mortgage you need.
But did you know that there are ways to up your chances of getting approved for a home loan? If you’re worried about the mortgage approval rate, we’re here to help. Check out these top ways to get the home loan approval you need, every time you need it.
Don’t Hide Your Income
An increasing number of people today are freelancers or small business owners. If you’re one of them, you might feel an incentive to report the lowest income possible, in order to save on your taxes. However, this can cause problems when it’s time to buy a home.
If you think buying a home is in your future, try to report as much of your income as you reasonably can. You might need that extra proof of income when it comes time to get loan approval.
Keep Your Job
Hoping to quit your day job? It’s best to wait until after you close on your home.
No matter how bad your employer is, it’s often worth it to stick it out until you’ve bought your home. If you quit before the home loan approval process is finished, you might not be able to get that loan after all.
Work on Your Credit Score
If you don’t know your credit score, you can’t expect to get approved for a loan. Before you apply, learn what your credit score is. Then, if it’s on the low side, make a plan to improve it.
This might mean paying off more of your credit cards or opening up new kinds of credit. The right strategy will depend on your unique situation. But without a good credit score, getting a loan is nearly impossible, so make this a priority. You can also check out the FHA loan option if you have a lower credit score, but these loans can cost a lot more.
Pay off Debt
Even if you have a good credit score, your debt can still impact your ability to get a home loan, as this article explains. Plus, it makes good financial sense to pay off debt before seeking home loan approval.
If you add a mortgage to a heavy load of debt, you might struggle to keep up with it all. Put yourself in a position to succeed with less debt, and lenders will be more willing to work with you.
Now, You’re Ready for Home Loan Approval
While nothing can guarantee home loan approval, these steps will make it much more likely that you’ll get approved for the loan you need. A little preparation can go a long way toward getting you into the home you want.
And even if you don’t get approved immediately after following these steps, they’ll all help you get into a better financial space. With a little more time, you can circle back to the home loan approval idea, and get approved the second time around. You may also check for providers of bridging loans in your area.
However, there’s lots more to learn about personal finance beyond these tips. Looking for more ways to get your financial life straight? Check out our Ways to Save Money section for more useful tips.