How to Get a Home Loan
Unless you just won the lottery or inherited money from a long-lost relative, to buy your first home, you will need to get a home loan.
Definition: Your mortgage is a loan that a mortgage lender gives to you to buy a home. That loan is secured, which means if you cannot make your payments, then your mortgage lender can eventually claim your home.
Buying a home, especially your first one, can seem like a daunting task. So much documentation, so many meetings, so many people – where does it end? However, you aren’t the first person to buy a home, and you won’t be the last either. By doing your homework, you can easily afford the right home for your financial situation without problems. But you need to start at the beginning.
Step 1: Financial Checkup
If you want a mortgage lender to lend you money, then you need to show that you can pay it back. Take a look at your income, your current expenses, your debt, your payments, your savings – all of it, and see where you can improve. Ask Shamrock Financial to review your financial situation to see how you can improve your chances of how to get a home loan.
Step 2: Get with the Programs
To encourage home ownership, there are different programs out there geared towards helping first-time buyers. They can range from down payment assistance, funds towards renovations, or even more relaxed terms for veterans. Ask at the municipal, state, and national levels to see what is out there.
Step 3: Meet the Mortgage Pros
Do you know how much you can borrow? The most accurate way to know is by meeting with a loan officer such as the ones at Shamrock Financial. They can review your finances, explain the types of mortgages available, highlight other home buying programs you may have missed, and help you get pre-approved. That pre-approval is the key to your American Dream. Some real estate agents prefer to work only with someone who has been pre-approved because that demonstrates that someone is – conditionally – willing to lend you funds.
As part of how to get a home loan, you need to shop around to find the right loan officer. One might be able to give you a great rate, while another may require a smaller down payment. Ask as many questions as you need, and negotiate what you can. After all, this transaction will involve a lot of money – your money.
Step 4 – Find a Real Estate Agent
Once you know how much you have been pre-approved for, it’s time to find a real estate agent. Perhaps you think you can find a home on your own – and you can. But real estate agents can do a lot of the background legwork, plus they have both connections and networks to make home buying task easier and faster. They can also have access to homes that aren’t yet on the market.
Ask family and friends for their recommendations. Make sure you interview several real estate agents to find one that seems like a good fit.
Step 5 – Seal the Deal
Your agent will take you around, look at houses in your price range, and soon, you will lay your eyes on the perfect house. But you’re not done. You need to negotiate the price, get a home inspection, and return to your loan officer for the official mortgage application. And if you have done your homework, the keys to that perfect house will soon be in your hands.