The economic crisis has flushed out the bad lending approval process and lenders will now have to screen more carefully before approving mortgage loan applications. Instead of being able to lend money for the purchase of your new home even if you have bad credit, lenders will now be forced to evaluate your credit rating more strictly.
Consumers will be burdened with the harrowing responsibility of ensuring their credit is in tip top shape, and many don't know where to begin with this task. Your mortgage broker can tell you how you'll need to spiff up your credit, but you need to start working now, not when you're ready to go and buy your next house.
You can say goodbye to "no mortgage refinancing payment" mortgage mortgage refinancing - they're a thing of the past. In the current economy, mortgage lenders will require consumers to have a down payment as well as good credit.
In the past, sellers were able to help with the down payment by funneling the money through a non-profit organization that was set up for this exact purpose. This system is no longer going to be used. This practice is what's been known as "seller assisted financing."
At the closing of your home, you'll need more money to put down. One hundred percent financing has been erased from mortgage lending practices. Your credit score will play a big part in how much of a down payment you have to have.
The better your credit, the less money you have to put down on your home up front. The worse off your credit rating is, the higher the down payment. Loans for people with extremely bad credit are either going to not exist at all, or be very hard to find.
The average amount that will be required for a down payment on a home now will be 3% for those with good credit to 10% for those with bad credit. Consider this a deterrent for people trying to get into a home that costs more than they can truly afford. With bad credit, you would need $20,000 cash up front to get into a $200,000 home, which usually isn't possible for anyone in a bad credit situation in the first place.
Have you ever seen those ads that claim you don't need proof of income to buy a home? This is the biggest purchase of your life and they don't even need to know how much you make! Not anymore - proof of income will be a staple in current and future mortgage loan deals.
You'll need to pony up tax forms, paycheck stubs, and bank account statements before a lender approves your mortgage loan. This means self employed men and women could have a harder time getting a loan. It's also going to be hard for people whose income fluctuates.
Cleaning up your credit will be crucial to helping you get into a home. Shoot for a FICO score of 740 or better and none of the above rules will prove to be a hardship for you. You'll want at least decent credit to get a better interest rate.
If you need help fast-tracking your credit cleanup, visit http://www.debtcredittips.com and start the repair process today so that you're not stuck renting for the next several months (or years)!
ไม่มีความคิดเห็น:
แสดงความคิดเห็น