What questions will be asked in the mortgage application?
What Will the Mortgage Lender Ask?
Are you fortunate enough to be able to buy a home and pay cash? If yes – good for you. However, like most people, you’ll need a mortgage. And while you’re eager to start looking at homes, put the brakes on. That’s because the very first step is to understand how much you can afford to pay.
Your first step is to speak with a mortgage lender and get Pre Qualified. And, by following this process, you’ll understand how much you can afford. And, by knowing this, you’re now able to search for homes in your price range.
Let’s help you get prepared for that meeting by knowing the answers to the following questions.
Do You Have Reported Stable Income?
It’ll be very difficult to get a loan unless you have stable, verifiable income. In order to get past the first step, have your recent pay stubs available.
Who Will Be on the Mortgage?
If you’re buying this alone, skip this one. But if someone else is involved, they’ll need to provide the same info. SO be prepared.
What Is Your Current Debt?
Lenders look at an applicant’s debt structure. They allow for a percentage of monthly income to be used towards debt. In fact, that percentage will include your “to be” mortgage payments. If the debt to income ratio is too high, it will reduce or eliminate your ability to get the loan.
What’s Your Monthly Budget?
You may very well qualify for a loan that you cannot afford to pay. You should have a number in mind of what you can afford to pay, while keeping your lifestyle and expenses at a comfortable level.
These are the questions you’ll need to be prepared for in the initial meeting. If all goes well, the next meeting will be the formal mortgage application. And you’ll need to answer a whole different set of questions then. But we’ll leave that for another day.
If you need a recommendation to a mortgage lender, please contact me