What You Should Know About Applying For a Mortgage

What You Should Know About Applying For a Mortgage

What do you need to qualify for a mortgage?

Before completing a mortgage application or even strolling through an open house, you'll want to know these things: Your monthly income. The sum of your total monthly debt payments (auto loans, student loans and credit card minimum payments) Your credit score and any credit issues in the past few years.

Should you pay off credit cards before applying for a mortgage?

Generally, it's a good idea to fully pay off your credit card debt before applying for a real estate loan. This is because of something known as your debt-to-income ratio (D.T.I.), which is one of the many factors that lenders review before approving you for a mortgage.

What do banks look for when applying for a mortgage?

Banks assess a borrower's income, other loans and living expenses to calculate how much money can be put towards home loan repayments. In the current market, lenders are looking much harder at borrowers' expenses by credit card statements, transaction accounts and any recurring spending patterns.

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