This content is sponsored by Lafayette Federal Credit Union
Maybe you’ve just gotten married, are expecting your first child or are simply tired of flushing money for rent down the proverbial toilet. Eventually, everybody thinks about buying a house and about how they can optimize the process to come out in the best shape financially.
With mortgages, the numbers matter. Buying at the right time, with the right down payment and at the right interest rate could save you thousands of dollars over the life of the loan and make the difference between settling for a house and purchasing a home you love.
Here are the numbers you should consider before you start the mortgage and house hunt.
Time to get a mortgage
The first metric to consider is how long it will take to save money for a down payment, gather your financial information and meet with professionals to go through the process of preapproval to closing.
First, start by looking for a lender who will comb through your financial history to give you solid advice about your mortgage options. The process of preparing to buy a house, though it may not be quick, is necessary.
Don’t let yourself get too impatient. The mortgage game requires strategy if you’re going to reach your goal.
Your financial history
Getting professional advice about the interest rate you could qualify for and what you might need to do to improve your credit is a smart decision.
“When you apply for a home loan, there is a list of the documents that will be requested throughout the process. These documents verify a number of facts about your life, from your income to your debts and beyond,” says Peter Benjamin, Sr. VP Mortgage Lending at Lafayette Federal Credit Union.
Be ready to be open about your financial past, including missed payments. If your finances have recovered and you’re repairing your credit, there is still a good chance that you will still be able to get a mortgage.
Your first appointment with the mortgage lender will give you an idea of the price range you can look in for a home.
For a list of possible documents that may be requested, visit Lafayette Federal Credit Union’s mortgage checklist. Pay stubs, W-2 forms and tax returns are some of the things you will probably need.
Down payment
What kind of down payment will you need? Do you really need 20% down? The answer depends on many factors, including the value of the home, your financial history and the type of mortgage you get.
Debt-to-income ratios
Another factor to take into consideration is your debt-to-income ratio and whether your other monthly payments will cause you significant financial stress. Before buying a home, organize your finances and eliminate debt to get in a better position.
Loan programs
There are several mortgage programs available for homebuyers, each offers its own set of benefits.
With a low down payment requirement and lender credits that reduce closing costs, a First-Time Homebuyer Mortgage can make that first home purchase a reality.
An Equity Builder Mortgage offers many great options, including lower monthly payments, stable rate index, and several loan term options.
Getting mortgage help
If you want help from a professional crunching the numbers that will add up to the perfect home for your needs and budget, talk to the experts in mortgage financing and qualification at Lafayette Federal Credit Union.
