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Simple Tips To Help You Understand Home Mortgages in Colorado!

By Ben Yost - 303-587-4297

Mortgage and Lending with First Time Home Buyer, Mortgage Rates, Pre-Approval NMLS 243370

January 11, 2017 03:21 PM

Simple Tips To Help You Understand Home Mortgages in Colorado

As you plan to buy your new home, the idea of getting a mortgage in Colorado will pop up frequently. You need to learn all you can before you pursue such a loan, but where can you get such an education? This article is the perfect place to start, so check out the advice below. Get your documents ready before you go to a mortgage lender. You should have an idea of the documents they will require, and if you don't, you can ask ahead of time. Most mortgage lenders will want the same documents, so keep them together in a file folder or a neat stack.

TIP! Understand your credit score and how that affects your chances for a mortgage loan. Most lenders require a certain credit level, and if you fall below, you are going to have a tougher time getting a mortgage loan with reasonable rates.

Have at least 3.5 percent of the purchase price saved. Lenders will want to verify that you have not borrowed the money, so it is important that you save the money and show deposits into your checking or savings account. Down payments cannot be borrowed; thus it is important to show a paper trail of deposits. Refinancing a home mortgage when interest rates are low can save you thousands of dollars on your mortgage. You may even be able to shorten the term of your loan from 30 years to 15 years and still have a monthly payment that is affordable. You can then pay your home off sooner. Ask those close to you to share their home mortgage wisdom. Chances are, they can give you some helpful advice. Some may share negative stories that can show you what not to do. The greater your exposure to information, the more comprehensive your knowledge will be.

TIP! Having the correct documentation is important before applying for a home mortgage. Before speaking to a lender, you'll want to have bank statements, income tax returns and W-2s, and at least your last two paycheck stubs.

Some creditors neglect to notify credit reporting companies that you have paid off a delinquent balance. Since your credit score can prevent you from obtaining a home mortgage, make sure all the information on your report is accurate. You may be able to improve your score by updating the information on your report. One of the easiest loans to get is a balloon mortgage. These loans offer a short term with the balance owed at the end of the loan. A balloon loan is risky since rates can increase by the time you need to refinance the balance you still owe. Monitor interest rates before signing with a CO mortgage lender. If the interest rates have been dropping recently, it may be worth holding off with the mortgage loan for a few months to see if you get a better rate. Yes, it's a gamble, but it has the potential to save a lot of money over the life of the loan.

TIP! When considering the cost of your mortgage, also think about property taxes and homeowners insurance costs. Sometimes lenders will factor property taxes and insurance payments into your loan calculations but often they do not.

Save up enough so you can make a substantial down payment on your new home. Although it may sound strange to pay more than the minimum required amount for the down payment, it is a financially responsible decision. You are paying a lot more than the asking price for the home with a mortgage, so any amount that you pay ahead of time reduces the total cost. Now you know how to get a great loan without any headaches or stress. As long as you use the tips you've read here, you should have no problems in the future. Be sure to use this education so that you don't stumble over the hurdles the experts who wrote it have already dealt with.