After the banks and big lenders made a bundle on the sub-prime market, they now have to give some of their profits back as the worst of their loans begin to default. Due to this, lending requirements have tightened up. How do you get a mortgage today?
Let me tell you about some people I know who recently got mortgages easily.
Young couple, 700+ credit score, 100% of value borrowed. How did they do it? One car paid for. One car only $200 per month payment. Minimal long term debt. They deferred the big credit purchases until after they own a home. That's why they have the score and that's why they got the home.
If you are not quite as good as the couple above, save enough for 3 to 5% down payment. When lenders see a little of your money in the deal, they become more receptive. Don't stretch your budget to the max. When the lender says you can get up to a $1500 per month payment (or whatever amount), that is where he or she makes the most money on you. Don't worry about the lender's paycheck, try to find a home where the payment is less than 80% of the lender's top number. It makes a big difference in your ability to handle the payment. This goes for Realtors, too. If your Realtor is pushing you to the top of your limit or over, tell them that is not what you want. If the Mortgage Broker or Realtor won't listen, get a new advisor.
Have your Realtor connect you with a mortgage pro before you get in the car. Know what you can afford and then follow the rules above. Good luck.
Bill Balatow- Lake Norman- Iredell County- North Mecklenburg, North Carolina
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