In the Boston Real Estate market, I’m sure you’ve heard that long-term mortgage loan rates are lower than ever right now. Because of this, the cost of owning a Boston home is lower than it has been for decades! If there was ever a time to buy a home in Boston, it’s now, while rates are low and predictions are saying the market will improve soon.
However, just because mortgage loans are cheap doesn’t mean they’re a cinch to get. Mortgage lenders have tightened their belts in recent years, mainly due to foreclosure numbers.
As your Boston Real Estate agent, I want to ensure that you are still able to buy the Boston home of your dreams! For you, this means learning how to become a savvy borrower. You can start by reading the mortgage tips for 2012 Boston homebuyers, provided by a MSN Real Estate article.
I summed up the best points for you here:
· Know your credit score. Before applying for a loan, you need to be familiar with your credit and if it’ll comply with the guidelines of major mortgage lenders. Most lenders would like to see a minimum credit score of 680, and most won’t accept one under 620.
· Have the information ready. The more prepared you are, the quicker the process will go. Before you head to the lender’s office, have your last two pay stubs, W-2s, income-tax returns and bank statements organized in a folder.
· Shop around. Use a mortgage calculator to decipher how much of a mortgage you can afford before you find out how much of a loan you can get. You don’t want to just accept the highest loan possible. Then, get estimates from three banks and three mortgage brokers before deciding on one. Consider rates, closing costs and the type of loan being offered.
· Continue financial stability. Don’t think that once your information is sent to the lender, you can go rack up your credit card bills. Most lenders will pull your credit again before the loan closes. Plan ahead financially so that you have money set aside to live off of during the process.
· Explain any monetary gifts you receive. If a relative offers money toward your down payment, that’s fine, but documentation, a signed letter and a paper trail will be needed. Also, most lenders require at least five percent of the down payment to come from your own funds, so plan accordingly.
· Don’t give up. You need to shop around so that if one lender rejects your application, you have hope with another. Ask the lender why you were rejected so you can fix the problem or shop for a new lender. Don’t automatically assume you’re a hopeless case!
Once you succeed past the first step of receiving a mortgage loan, we can begin the process of finding a Boston home in your budget. Contact me when you’re ready to get started!