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Whether you are a new or veteran homeowner, buying a house can feel a bit taxing. The process can seem like a lot of hoops to jump through, especially if you are looking to finance your purchase. Luckily, the steps to buying a house aren’t actually that involved, so long as you choose a preferred lender who knows the process.
Choosing a preferred lender is crucial to having a streamlined and hassle-free transaction, because they can outline the entire application process from start to finish. Unlike other lenders, preferred lenders like New Century Mortgage can also recommend a variety of different financing options to fit your particular buying scenario.
Do you need to put less money down? Is your credit score lower than you expected? A preferred lender can help you navigate these obstacles and get you into the house of your dreams.
Step 1. Check Your Credit
Before you apply for a loan, always consider obtaining a copy of your credit report. You can get one from each of the three reporting bureaus each year. Make sure to review your credit report for any errors or discrepancies. Address any erroneous issues that may impact your ability to obtain credit before speaking with a lender. If you have proof to for any discrepancies, you can always submit this information to your lender to support your claim if needed for the purposes of the mortgage loan only.
Also, limit the amount of new credit inquiries at least a year before you know you will be applying. New inquiries or tradelines can throw off your credit score and qualifying debt-to-income ratios.
Step 2. Get a Pre-Approval Letter
Today’s real estate market is cut throat as inventory remains low and demand for affordable homes continues to increase. That said, many realtors will require a pre-approval letter that indicates your credit has been checked and a lender is comfortable financing your new purchase (with some conditions) for a new purchase before issuing an offer on a new home.
Keep in mind you don’t have to stay with the same lender you get a pre-approval from, but chances are if you go with a preferred lender like New Century Mortgage, you won’t even need to consider switching.
Step 3. Submit Your Application and Supporting Docs
Once you find that dream home, place an offer, and it is accepted, the next important step to buying a house is submitting your formal credit application and supporting documents to your lender for review.
Make sure to have your documents collected and ready to submit prior to applying. Most lenders will like to see recent pay stubs (covering a 30-day window) and most recent W-2. Some may also require two years of personal tax returns, as well as two years of full business tax returns for those that are self-employed. Make sure to include two-months worth of asset statements showing enough funds for your down payment and closing costs. Make sure you have enough cash to close, so always be prudent when choosing a purchase price.
Then it becomes a waiting game as your file is reviewed by underwriting. This step can often take the longest (especially if an appraisal is required), but many preferred lenders can get applications approved in as little as 48 hours (assuming they have all the required documentation).
Step 4. Finalize Your Loan Terms and Prepare to Close
After your loan has been approved, it’s time to finalize your terms and prepare to close. This is the time to purchase your homeowner’s insurance, possibly purchase an owner’s title insurance policy, and complete your final walk throughs of the property.
It’s also important to review your Closing Disclosure for accuracy. Your Closing Disclosure will be provided within three days prior to your closing date. Verify that there are no unexpected changes to the loan terms or fees.
After that, just remember to show up to your closing appointment and sign on the dotted line.
Step 5. Enjoy Your New Home!
Many buyers get so stressed throughout the application processes that they forget this simple step: enjoy your new home! All your hard work will pay off. While the steps to buy a house can seem a bit intimidating, it’s easier than you think, especially if you have a preferred lender like New Century Mortgage to walk you through the entire process from start to finish!
If you are looking to buy a new home consider New Century Mortgage for your financing needs.
Give us a call at 850-775-0135 or email us at email@example.com.
*Conditions and terms apply, please contact us for further inquiry. Pre-qualifications and Pre-Approvals are valid for a limited time from the date of credit pulled. If we do not receive an executed purchase agreement in the timeframe we inform you of, then we will regrettably be unable to give further consideration to your credit request. Pre-qualifications/Approvals are not a final loan approval or a commitment to lend. Pre-qualifications/Approvals are contingent on an approved loan application which will include verification and approval of the information we received to issue a Pre-Qualification/Approval as well as your credit, income, employment status, debt, property, insurance, appraisal and a satisfactory title report/search. If the Pre-Qualification/Approval is for a primary residence it may be continent on the sale of your current home. Not all properties are eligible for financing. interest rates are used for qualification purposes only and do not constitute a rate lock commitment. Terms and conditions may vary depending on the lender, this is not an offer or consideration of a loan or a pre-qualification nor a pre-approval, and you must contact New Century Financial Mortgage, LLC in order to inquire.