If your partner, spouse, or roommate is pushing you to buy a home and you think that your credit and finances could allow you to do that, there are some things that you want to know. If you have never gone through the mortgage application process or taken out a mortgage, you want to know what benefits you could receive. Here are a few questions to ask yourself to help improve your chances of getting approved for a loan and so you can get the best rates.
Are You a First-Time Buyer?
As a first-time buyer there are loans specifically targeted just for you, and they come with perks like a low interest rate and lower down payment requirements compared to other loans. This is because many financial institutions want to give you the chance to not only buy your first home, but to be successful with paying your mortgage. If you are first-time buyer, look for FHA loan providers in your area.
Were or Are You in the Military?
Those who are veterans or are still actively serving the country will be allowed to apply for a VA loan. This is a loan that is given to you and guaranteed by the Department of Government Affairs. If you are interested in this type of loan and you are currently not a member of any type of military related financial institution, talk with the VA association about qualifying and getting started with the process. They can put you in contact with financial institution options for the financing.
Are You Using a Co-Signer?
A co-signer is a person that will go on the loan with you. If you have poor credit, you may need someone with better credit to sign and say that they will be responsible for the mortgage if you fail to pay. If you have good credit and your partner, spouse, or someone that wants to apply with you has poor credit, you will want to leave them off the loan. A co-signer will help or hurt your chances of getting approved based on your personal situation.
You want to know all of your options before you pick a company to use for the mortgage and start filling out the paperwork. Look at the different interest rates so you can be sure that you get the best interest rates, terms, and payment options to buy your first home.