Tips for First Time Buyers Seeking Home Loans

Perhaps you have decided you are going to take the plunge and buy the home of your dreams. You have saved, scrimped, and climbed your way to the point where you are able to afford to live in a home you can call your own. The only thing you need to do now is apply for the home loans you will need to get the home of your dreams. In today’s world, applying for home purchase loans is easy; getting approved for these loans is a little harder. Below, you will find some tips on how to get the home loan you need.

Check Your Credit

Before you even consider talking to a lender, you will want to have a credit report pulled. You are entitled to one free credit report per year, and when you start applying for home loans, is the right time to get it. Remember, just because you pay everything on time doesn’t mean your credit is the best in the world. There are other considerations, including exactly how much credit you have. It’s best to know what you are working with before you start trying to get any type of home loans.

Determine how You Spend Your Money

You will want to take a couple of months to track how you spend your money. Evaluate your assets and liabilities before you make a decision on what you are willing to spend and what type of down payment and monthly payments you can afford. You will probably need about two years’ worth of steady earnings to show a lender before they will even consider giving you a home loan.

Organize all of Your Documents

The term have all of your ducks in a row has never been more apt than when you are applying for a home loan or even for home refinance loans. You can, of course get a HARP refinance loan, but you have to have your ducks in a row here as well. You will want to have all of your paperwork from tax information to recent paycheck stubs before you even step into a lenders office. Without the right documents, you are more likely to be turned around at the door.

Underwater?

In today’s struggling economy, many homeowners find themselves in foreclosure for no other reason than the housing market has toppled. This is where the HARP refinance loan can come in handy. Many homeowners are paying on a home that is not worth even remotely what it was when they bought it years ago. If you want to refinance your home because you are underwater on your mortgage, this is an option you will want to check into.

For first time buyers, procuring a home loan can be pretty confusing. Follow the tips above, and you should have no problem at all.