How to Buy Mortgage
How to buy a mortgage in 6 simple steps!
Ok so you want to know the process of how to buy mortgage? Good question! You wouldn’t blindly go and invest thousands of pounds into a business without first understanding the things you need to do so would you?
Applying for a mortgage is no different and is a big of an investment as any!
The first step you need to take when trying to find out how to buy a mortgage is to find out if you QUALIFY for the loan you have in mind.
How to buy mortgage? Qualify – That’s a good start!
There’s nothing worse than finding your dream house and then realising that your lender isn’t willing to give you the mortgage because you do not earn enough to qualify for the loan.
You can avoid this by finding out beforehand how much your lender is willing to lend you on your current income (or your combined partners income)
Another way to avoid it is to perhaps negotiate a lower interest rate! Some lenders are of course more responsive than others but it isn’t unheard of to negotiate a lower rate that drives your monthly payment down to the point where you would then qualify for the mortgage.
Lastly, you can check out any schemes that are available to you – If you’re from the U.S you might find lending programs backed by the FHA (Federal Housing Administration), the Veterans Administration (VA), and The Federal National Mortgage Association (Fannie Mae) that may help you to secure a mortgage. Other countries may also have schemes, for example, I know the U.K has various schemes too. See if they can help you secure your mortgage!
The 2nd step is to decide the loan type that will best suit your situation.
This can be determined by researching each type in depth – You have options including but not limited to, Graduated Equity Mortgage (GEM), the Graduated Payment Mortgage (GPM), fixed rate, adjustable rate mortgage, balloons, Jumbo wholesale mortgages, conforming, 2-steps and Buydown mortgages.
The 3rd step is to find your property!
You can hire an agent to work for you or you can work through the agent selling on behalf of the seller. Now that you know how much you can borrow from your mortgage, this should give you a budget on what kind of house you can buy.
Be thorough in your search and always negotiate with the seller and/or agent for the best price!
Ok, once that is done your 4th step will end up with you back at your lender (or a chosen lender) who should then make you aware of the total cost including any closing costs or fees such as application fee’s, insurance, closing costs etc
Nearly there! Quickly on to step five of how to buy mortgage! The Application and approval.
So you’re happy with all the final costs, you are now going to apply through your chosen lender who should really try to make the mortgage application as pain free as possible but hey, it’s a mortgage application so how much fun can it be??
However, a good lender will of course assist you to ensure you beat the final closing date and have your loan approved (all things pending)
Ta-da! Here we are at the final step of mortgage buying and you will now know how to buy mortgage in it’s entirety!
Step 6 is the closing of the deal! The signing of the property over to you and money changing hands.
This should be a pain-free process if you are well prepared (and you should be!) – Find out from your lender exactly what documents you need to bring and everything should run smoothly!
REMEMBER, your mortgage deal can steal flop at this stage so be sure that you don’t spring any nasty surprises on yourself and find out from your lender exactly what you need so you’re prepared and organised!
That’s it! You’re now the proud owner of, hopefully, your dream home! Enjoy!
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