Fundamentals of Mortgage Loans


Interest rates are near historic lows. Purchasing power has increased, and the cost of renting in many areas is now greater than the cost to buy. Some people believe mortgage loans are impossible to obtain without perfect credit and 20% down. Is this true? Read on, and we’ll cite the three basic factors for qualifying for a home loan.


1) IncomeIf you have a job or steady source of income, you’re off to a great start. If you’re already able to pay your rent on time each month, this could actually be easier than you might think.  All we need is two years of employment history to start your application.


2) Assets – You may not need a 20% down payment. In reality, many programs will work with 5%, 3.5% or 3%, and in some cases, even 0% down. In certain instances, closing costs can sometimes be paid by lenders, sellers or come from gifts or grants. So, if you think you’re out of luck just because you don’t have tons of cash, no worries. Chances are, there may be a solution that may work.


3) Credit Your credit is likely in good shape if you pay your bills on time and have avoided major issues like bankruptcy, foreclosure, short sales and judgments. Requirements will always vary, but there can still be reasonably flexible loan options, such as the FHA loan guarantee programs.


That’s it- these three items are the fundamentals of mortgage lending. Exceptions will exist, but don’t be fooled into thinking the process is impossible. For those who work and pay their bills, there may not be a whole lot standing in the way of homeownership.

Reach out now, and we’ll be happy to help you start the path to homeownership. 

A simple pre-qualification is a great place to start, and a phone call is all it takes. Or visit today!

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