First Things First – Personal Finances

Whenever you undertake any big financial change, the first thing to do is to check your credit score. The three major credit bureaus are required to provide you with a free credit report annually. You just have to initiate the request. It is important to check your score because that is one of the first things a lender will do.  

Your credit score will show a slice of your financial history that includes loans, credit cards, and utilities payment histories. You will want to make sure that everything on the report is accurate, so you can clear up anything that may be bringing your score down. A good score can help you negotiate a better interest rate on some loans.

In most cases, buying a house requires a down payment. Before you start the process in a formal sense, it is a good idea to start accumulating funds for the down payment. One idea is to create a set-aside account that deducts automatically from your direct-deposited paycheck. This takes away the temptation to skip putting the money away, or waiting for another, easier time to start saving. The more you can accumulate before you apply for a loan or discover the property you really want, the better position you are in to make a move.

Next, Get an Expert on Your Side

The next major step to make is to become acquainted with your credit union mortgage specialist. Even if you are not yet ready to apply for a mortgage, the beginning of the shopping process is the right moment to get to know an expert with the knowledge and experience to navigate the twisty path of real estate purchases. Your mortgage lending specialist has likely seen every kind of loan imaginable and will be keen to learn about both your homebuying wish list and your financial situation.

If looking at your credit score left you confused, or you have fears that a mortgage is not possible, your mortgage expert may be able to help you see exactly where any problems lie. For example, their experience may give them insights into how you could reform a credit score that could be keeping you from showing your best financially.

Learn About Your Options

A few minutes on the internet researching mortgage programs may leave your head spinning. It seems like every possible institution offers every possible kind of loan. That is not exactly the case. Besides the most common conventional mortgage loans, there are special programs aimed at different types of borrowers and properties.

When you meet with your mortgage specialist, don’t forget to discuss any qualifying life experiences that you, or the kind of property you are seeking, may bring to the table. For example, you may be a veteran or in the military now. That could qualify you for a Veterans Administration loan. Your prospective property may itself qualify for a HUD or USDA loan.

Each of these varieties of mortgage differs from standard mortgages in situational requirements, and in what you have to put down in your down payment (in some cases, you could avoid a down payment altogether). Some programs also help with mortgage insurance requirements. This is why having a professional helping you can be so beneficial.

Add Mortgage Calculators to Your Toolbox

It is easy to overlook the mortgage calculators that are on our website. These are powerful tools for you to consider what could work best for you. An excellent example is the opportunity to investigate the effects that the three types of conventional mortgages can have on your payments over time.

If you enter the amount you are considering spending on a home, then try out a fixed rate, a variable rate, and a balloon rate mortgage (using the current rates as samples), you will  be able to see good estimates of what you would pay over time. Another example of the usefulness of mortgage calculators is to examine the change from 30- to 20- to 15-year terms. Shortening the length of time you pay on a mortgage will raise the monthly payment amount, but the savings in interest can be significant.

Using a loan calculator not only allows you to look at the long term, you can also use it to compare your current mortgage or rent payment with the new loan . That allows you to be strategic in determining how much of a loan you would need.. Your mortgage expert can also help you to figure in a well-reasoned estimate of closing costs, so you are working with numbers closest to what will apply to you.

Mortgage Pre-approval: Show You Are Serious When You Shop

The number one strategy for good bargaining is to come to the negotiation with a pre-approved loan. You know how much you are willing to spend. You know what you want in a home. And, you are ready to make the deal that you want. This works for home buying just as it does for car shopping. Make sure that you are clear about how much of your pre-approval you will be using as the purchase price, how much is for closing costs, and how much will be part of your real estate agent’s commission.

Home buying can seem like a difficult process, but having a specialist’s help on your side can make all the difference. Our mortgage experts are available to work with you through the many procedural tasks that are part of homebuying. Setting a strategy to map your best route gives you the best chance of enjoying the journey.

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