We Buy & Sell Homes & Properties

Faq

How much house can I afford?
When evaluating how much you can afford for your home and mortgage, lenders usually use two rules of thumb:

1. Your maximum monthly mortgage payment should not exceed 28 percent of your gross (pre-tax) income.
2. Your maximum debt load, including your mortgage payment, should not exceed 30 percent of your gross income.

These ratios are typical of those required to secure a conventional mortgage. Lenders will be able to supply details about other types of mortgages, such as FHA or VA loans, which offer more flexible qualification standards. There are many types of mortgages and financial tools available that provide flexibility in interest rates, terms, and down payment requirements

 

Q. How can I check my credit rating before I apply for a mortgage?
A.
Your credit rating is based on a combined score generated from three credit bureaus who look at your credit history, amount of credit available, and recent inquiries to determine what’s called your FICO score. For a small fee, you can get your score or review your credit report by going online to www.myfico.com or contacting the credit bureaus directly at:

  • Equifax: (800) 685-1111
  • Experian: (888) 397-3742
  • TransUnion: (800) 916-8800

Q. What happens if the house I want to purchase does not appraise at the amount expected?
A.
. If the house doesn’t appraise at the amount expected, other alternatives are typically found. A second appraisal may be sought, the buyer may be willing to put more money down, the seller may adjust the price or offer other concessions, or the two sides may negotiate to split the difference between them.

What’s the difference between being pre-qualified and pre-approved for a mortgage?
Typically you will first pre-qualify for a mortgage, then get pre-approved before you have found the specific home you wish to purchase. What is the difference?

  • Pre-qualification: An informal determination by a lender or mortgage broker stating how much mortgage you can afford.
  • Pre-approval: A guarantee in writing by a lender to grant you a loan up to a specified amount.

 

What are the advantages of being pre-approved?
There are two advantages of being pre-approved for a loan as early as possible in your home buying process:

1. Sellers will find any offer you make more attractive if you are pre-approved for a mortgage.
2. The length of time before closing can be shorter if you’ve completed the steps to securing mortgage approval prior to signing a contract on a property.

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