We offer various options to help you finance your home. Your Home Lending Expert can review each of the following with you to help determine which mortgage loan is right for you, including term length and fixed or an adjustable rate.
What can you expect from now until closing day?
Prequalify online. Go to APPLY NOW and begin. Do this first so you know how much home you can afford
To help us better serve you, please be ready to provide the following documentation. You may be asked for additional items during the process.
When you decide you’re ready to buy a home, examine your own finances closer than you ever have before – because your mortgage underwriter will be looking at your finances even more closely. It’s the underwriter’s job to evaluate your income, credit score, and assets to make sure you’re a solid loan candidate.
Because of this, it’s important that nothing you do makes your mortgage company question your ability to pay them back. Here’s a list of things you should avoid doing during the mortgage process.
Avoid any major lifestyle changes, if possible. Whether it’s buying a car or finally deciding to quit your job and become an artist, big changes that can put a strain on your bank account are red flags to underwriters.
Even big deposits can be questioned by your underwriter. Your underwriter wants to see a steady, regular flow of income. If your family knows you’re house hunting, they might want to help you out but, if you’re accepting any sort of significant cash gifts to help with your down payment (anything exceeding 50% of your monthly income), you’ll have to do a few things to make sure your lender understands it’s a gift – not a personal loan.
Your generous donor will have to write a gift letter to your lender. This should include personal information about the donor, their relationship to you, the property’s address, the total amount of money gifted, the date of the transaction, and a statement saying the donor is expecting nothing in return.
Turn that friendly cashier down when they tell you how much you’ll save by opening a charge with them. And, don’t close any cards out, either. Both actions can hurt your credit score, and you want your credit score to be as high as possible when you apply for a home loan.
By opening a new line of credit, you’ll create an inquiry on your credit report, which can lower your credit score. And new payments that come with your new credit card can negatively affect your debt-to-income ratio.
Instead of closing out credit accounts, just pay them off monthly like you typically would. This way you keep your open credit, and your credit score stays high.
While some things in life can’t be changed, like illness, job loss, and natural disasters, others, like your personal finance habits and lifestyle, can be monitored and can hurt your chances for mortgage approval if not handled correctly. If you anticipate any big, unavoidable changes during the underwriting process, always make sure to talk them over with your Home Loan Expert.
What you offer on a property depends on a number of factors including its condition, length of time on the market, buyer activity, and the urgency of the seller. While some buyers want to make a low offer just to see if the seller accepts, this often isn’t a smart choice because the seller may be insulted and decide not to negotiate at all.
If you can be flexible on the possession date, the seller will be more apt to choose your offer over others.
Often, the seller plans on leaving major appliances in the home; however, which items stay or go is often a matter of negotiation. Typically, you will not be present at the offer presentation - your realtor will present it to the listing agent and/or seller. The seller will then do one of the following:
By far the most common is the counter-offer. In these cases, your realtor’s experience and negotiating skills become powerful in representing your best interests.
When a counter-offer is presented, work with your realtor to review each specific area. Keeping your goals in mind, seek to negotiate the best possible price and terms.
You’ll need money for your down payment—typically a minimum of 3% of the purchase price (Example $3,000 for a house that appraises for $100,000) depending on the type of mortgage, and you may be responsible for closing costs, as well. Consider using some savings, a financial gift, or proceeds from a previous home sale for the down payment and closing costs. If your down payment on a conventional loan is less than 20%, you must pay private mortgage insurance (PMI), which covers the lender if you stop paying your mortgage and default on your loan. PMI usually costs less than 1% of the outstanding loan balance, so putting 20% down can save you thousands of dollars over the life of the loan. Learn more about down payment requirements.
Banks look at your credit score, your income, and the value of the home you’re buying to determine how much they’ll lend you. Credit scores range from 300 to 850. A higher credit score may lower your interest rate—and lower your monthly payment. If you’ve recently missed payments or maxed out your credit cards, you may consider waiting to purchase a home until your credit improves so you can qualify for a lower interest rate. Learn more about credit scores and how you can improve yours.
All of your monthly payments toward your existing and future debts should usually be less than 43% of your monthly income. However, the amount you qualify for based on this calculation may not be suitable for you. You should review your personal situation and work with a financial advisor to decide how much you can comfortably afford. To calculate your debt-to-income ratio, divide your monthly payments by your monthly gross income.
Use this formula to get an idea of your debt-to-income ratio: A/B = debt-to-income ratio
For example, if your monthly income is $5,000 and your monthly debts and future expenses are $1,000, your debt-to-income ratio would be 20%.
If your debt-to-income ratio is more than 43%, you still may be eligible for a mortgage if another person completes the application with you. We'll ask you for the co-applicant information during the application process.
A credit score not only influences your home-buying potential but is essential for obtaining several services and big-ticket items. Ninety of the top 100 largest U.S. Financial Institutions use the FICO score to make consumer credit decisions, according to MyFico.com.
Your FICO score is reviewed by most of the following entities:
Typically, the higher your credit score, the better your chances for approval and securing a lower rate. But, just how exactly is your score determined? Most companies use a FICO score that is comprised of five elements:
To know your score, obtain your credit score.
FICO scores range from 300 to 850, with higher numbers being better. A score of 700 is a good indicator of financial health, and most lenders prefer scores at or above that number, but it is not required.
This is a free service available to you each year, so take advantage. Visit www.AnnualCreditReport.com and request your free copy from all three credit reporting companies.
Beware of other companies that charge fees for credit reports, because they are often not as accurate as the three mentioned above.
There is no charge for checking into existing errors, so make sure there are no inaccuracies listed on your report. It is your responsibility to notify the credit bureau of any mistakes, which should be cleared up within 30 days of the report date. If you need to boost your score, here are a few tips that could make a difference to your score. While these are general tips, be sure to check with your lender before paying off large accounts and moving your money around for closing costs and the down payment.
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