1. Improve Your Credit
Your credit score is important to a lender and determines what type of interest rate you qualify for. Manage your current debt responsibly. Always pay your bills on time and chip away at your outstanding balances by paying more than the minimum. You can obtain one free credit report from each credit reporting company. If you see something that doesn't look right, have it removed.
2. Plan For a Down Payment
Although a 20 percent down payment on a mortgage loan is ideal, it's not mandatory. In some cases, if you can’t afford a 20 percent down payment, your lender will require you to pay for mortgage insurance because they’re increasing their risk by loaning you more money.
3. Get Pre-Approved
It is recommended to get a mortgage pre-approval. This process is used to help determine how much money you are qualified to borrow for a home purchase. The lender will do a credit check and go over your income statements to determine your financial means. Once you're pre-approved, you will have a more realistic expectation of which homes fall within your budget.
4. Shop For a Lender
The homebuying process involves finding an interest rate and mortgage lender that best suits your financial situation. No two sets of lender fees are alike, so it's important to get loan estimates from multiple lenders before making a decision. Call the lenders or meet with them to see who you feel most comfortable with.
5. Decide on a Loan Type
There are several types of home loans available. Not all homebuyers are suitable for the same loan programs or qualify for certain products. Here are some examples of various loans:
- If you are a military veteran, consider a Department of Veterans Affairs (VA) loan.
- First time homebuyers with good credit may qualify for the first-time homebuyer loan via the Federal Housing Authority (FHA). FHA loans require only a 3.5% down payment and typically come with good interest rates.
- Really expensive homes may be more suitable for a jumbo loan.
Start Your Home Search With Platinum Group, Realtors
Buying a home in Colorado Springs is a major investment. There is no reason to pay more than you have to. Many homebuyers do not take the steps necessary to get the best mortgage they can. By following these tips and consulting with your agent at the Platinum Group, Realtors, you can be comfortable, knowing you found the right loan for you. When you are ready to start looking for homes in Colorado Springs, we can refer lenders in the Pikes Peak area to help save you time and money.
The Platinum Group, Realtors The First Choice in Real Estate
The Platinum Group, Realtors The First Choice in Real Estate
Visit our website: www.PlatinumHomeSales.com
6760 Corporate Drive, Ste 300
Colorado Springs, CO 80906
(719) 536-4444
