Finances
Here are the steps:
1. Gather the financial documents you'll need to get a mortgage:
- pay stubs
- statements from banks, mutual funds and retirement accounts
- income tax returns
- records of debts such as auto loans, mortgages, student loans and credit cards
2. Find out your credit score.
- Go to MyFICO.com and see your credit score and a get a copy of a credit report. Your credit score is a distillation of your bill-paying history expressed as a three-digit number between about 300 and 850, the higher the better. A score above 720 is most desirable, the equivalent of a getting an A.
4. Find a broker or lender, who will review your finances and estimate how much you can afford to borrow.
Prepare to be shocked at how much money lenders will give you. And don't borrow that much.
5. Get pre-approved for a mortgage so that when you make an offer for a house, it's taken seriously.
When you're pre-approved, a lender has agreed to lend you a certain amount of money for your home purchase at specified terms and conditions. Pre-approval gives you leverage in the deal-making process, because it establishes your buying power. The letter of preapproval you get from your lender makes the bid you put on a property as reliable as a cash offer.
Go to our Mortgage Info page for assistance in selecting a mortgage program.
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