January 27th, 2017 5:09 AM by Jackie A. Graves, President
be frank: It's not easy to get a home mortgage. Nor is it impossible. In fact,
millions of people apply for and obtain a new mortgage every year.
want to get a mortgage but you're anxious about the process, you might want to
start with online research and self-education.
where most people begin, according to research from the National Association of
Realtors, or NAR. Researching online can help you get comfortable with the
process and find professionals to contact.
you'll have to reach out to a live person to move forward. As Ken Pozek, a
Realtor with Keller Williams Realty in Northville, Mich., says, "You can't
figure out everything using an app.
you talk to someone who's very knowledgeable, you might forget to ask about
private mortgage (insurance), homeowner association dues -- there are so many
little idiosyncrasies. It's the mortgage professional's job to walk you through
that," Pozek says.
you'll need to choose a lender before you can start seriously shopping for a
home, though it's fine to contact a Realtor first to get a referral to a
lender, says Jay Dacey, a mortgage broker for Metropolitan Financial Mortgage
Co. in Minneapolis.
you're a cash buyer, you're going to need to get a mortgage," Dacey says.
"A good Realtor is going to want you to get preapproved before they put
you in their car and take you out driving and showing you houses."
want to help buyers get started with the mortgage process, says Amy
Butterworth, associate broker at Gibson Sotheby's International Realty in
make sure we're involved in the mortgage process as well, so if buyers are
putting in an offer on a property, (we know) they're ready to go from the
finance standpoint as well," she says.
first-timers need to let go of two common misconceptions about getting a
mortgage, Dacey suggests.
first is that you'll have to save at least 20 percent of a home's purchase
price for your down payment. In fact, if your credit score is acceptable, you
can get a conventional home loan with a down payment of just 5 percent, and the
entire amount can be a gift from a family member, Dacey explains.
FHA loan insured by the Federal Housing Administration requires just 3.5
July 2013 NAR survey of 8,767 homebuyers and sellers found that nearly 90
percent of buyers financed their purchase. The median down payment for
first-timers was 5 percent.
second misconception is that first-time buyers are automatically entitled to
tap some sort of broad generic first-time homebuyer program. Assistance
programs do exist, but each is unique and many are restricted to certain
geographic areas, Dacey explains.
you're buying a house for a special program, you're going into it with the
wrong intentions," he says. "Find the house first, then see if there
are any special programs."
also need to get ready for the lender's inevitable onslaught of requests for
financial documents. The amount of paperwork can amaze, humble and frustrate
borrowers, says Ed Conarchy, a mortgage loan originator at Cherry Creek
Mortgage Co. in Gurnee, Ill. A good tip is to ask for a list of all --
underline that -- the documents that might be necessary, and be prepared to
also need to get comfortable with how much they feel they can afford to spend
to buy and own a home. That amount might be less than the maximum they're
qualified to borrow, Conarchy says.
you can get approved for and what you're comfortable with are usually two
different things," he says.
reason: Home repairs and maintenance can be more costly than many new
homeowners realize. That means the tradeoffs between renting and buying might
not be clear without some number crunching. It's not adequate, Conarchy
suggests, just to compare monthly rent to a monthly mortgage payment.
concentrate on just getting approved and having a mortgage salesperson tell
you, 'We can get you a mortgage and get you into that house,'" he says.
"Make sure it's going to be a fit for your personal situation."
By Marcie Geffner - To view the original article click here