Tips for Getting Your First Mortgage
Ready to take the plunge and purchase your first house? Congrats! Homeownership is a big, exciting step — but getting your first mortgage can be quite complex, involving many steps. That’s why it’s important to prepare as best you can before shelling out the down payment.
Taking the right steps to start with make it far less complicated down the road. Before signing on the dotted line for your mortgage, take these steps to ensure that the process goes smoothly and efficiently.
Get a copy of your credit report - You can retrieve a free credit report from each of the three credit bureaus at AnnualCreditReport.com.
The standards are higher in terms of what score you need and your credit score will affect the cost of the loan. While it’s beneficial to pay everything on time, that doesn’t always mean your credit score is where it should be. The lower your utilization rate is of the credit available to you, the higher your score will be — and in order to obtain a mortgage, you’ll want to have a lot of credit available, with less than a third of it in use.
Get preapproved - Ensuring that you’re preapproved for a loan makes the home-buying process a lot easier on you. Kleberg Bank's online home loan application makes it easy to apply for prequalification.
As a first-time homebuyer, you'll need to be very savvy and have an upfront preapproval letter to help give the seller confidence that you will successfully close the loan and obtain the funds. So before you even begin your search, make the process of getting preapproved mandatory. And along with that, be patient.
“Buying a home is really like finding a job — it’s going to take a lot of time to prepare,” said Cara Pierce, a certified housing counselor with ClearPoint Credit Counseling Solutions. “That way, when the deal comes along, you’re ready to pounce on it.”
Track your spending - As a first-time homebuyer, you'll want to do everything right. So, it's a good idea to track your spending for a couple of months to see where my money goes. Even if you aren’t in debt and you pay your bills on time, it’s important to evaluate how you spend your money. For example, are you able to sock away extra funds at the end of each month or do you typically live paycheck to paycheck? When you’re pursuing your first mortgage, it’s important to have a good idea of what’s coming in and what’s still owed.
Get rid of debt - It sounds simple, but it makes a big difference. Not only does being debt free make it more likely you’ll get preapproved for a decent loan, but paying your mortgage each month is much easier if you aren’t still paying off debt. It’s also not wise to be purchasing expensive items around the same time as buying a home — for example, a car.
Organize documents in advance - Paperwork isn’t the most exciting thing in the world, but lenders do typically require an array of documentation when issuing a mortgage — things like your W-2s, bank statements and tax returns. Gathering these items ahead of time can ensure that nothing gets delayed and you can move on to owning your home as quickly as possible.
You need to be organized and be able to pull all this information together. Having to take the time to track down various documents the lender needs will slow the process down.
Kleberg Bank Mortgage professionals are ready and willing to help walk you through the entire process. If you’re considering getting your first mortgage, call us in Kingsville at 361-592-8501 or Corpus Christi at 361-850-6800 or APPLY NOW to prequalify and learn the options available to you.