Slamming the door on zero-down purchases and “drive through” lending, the credit crisis has made it difficult for home buyers to get financing. For many, the once obtainable American dream of home ownership seems a fleeting ideal. Despite the bleak outlook, I have helped numerous qualified buyers get financing and purchase homes. I want to help find you the right home, but before you start looking, it’s imperative to get your proverbial ducks in a row to avoid being disappointed down the road.

Determine What You Can Afford

Your dream home can be a reality. You just need to dream in your price range. Your down payment should be at least 10- 20% of the purchase price of the home. Plus, you need to be able to maintain a low-debt to service ratio.

Get Pre- Approved

With their new stringent regulations, lenders will want to know a great deal about your financial history before they give you a loan. Most banks want applicants to have a credit score of at least 620. The application process will be faster and smoother if you have all the necessary documentation in order beforehand including tax returns, proof of income, and information on any debts including credit cards and auto loans.

Refrain from Major Purchases

While buying the cigarette boat may seem like a super sexy purchase, prior to closing is not the time to buy a new vehicle, especially a motorcycle or boat. A new policy from Fannie Mae (effective June 1, 2010), requires lenders to “refresh” the borrower’s credit report just prior to closing. This means buyers must be careful not to negatively impact their credit score during that time period with careless spending. Be vigilant not to increase your credit balances and don’t open new lines of credit.

Let me help you navigate this complex process so you can open the door to your new home.

Related posts

• No related posts.