Buying a home is a wonderful experience regardless if it is your first time becoming a homeowner or if you have purchased many homes before. There are also many benefits to homeownership, such as having more privacy, tax benefits, decorative freedom, and it is a great long-term investment. But before you can start gaining all these benefits, you must first understand what all it takes to get approved for a Houston mortgage.
So, to help you get started on your journey of ownership, your local mortgage lenders at Austin Capital Mortgage, Inc., have listed the top three mortgage approval tips.
Tip #1: Good Credit
Being up to date with your finances and understanding what your current credit score is can help you when starting the Houston mortgage application process. Your credit score has a major impact on whether or not you can qualify for a home loan and it determines the types of rates you will receive as well.
So, before you begin your application, make sure you have a good credit score and are not swarming in large amounts of debt. To help improve your score, try to pay off as much debt as possible and be sure to pay off the high-interest loans first.
Tip #2: Sufficient Savings
Make sure you have a decent amount of savings in your account before you decide to become a homeowner because I’m sure you are well aware of the financial obligations that come with buying a home. A home is not cheap and you will need to afford at least 20% of your home’s down payment unless you want to pay for additional mortgage insurance known as private mortgage insurance.
Also, having sufficient savings will show lenders that you are financially responsible and can afford to make payments on your mortgage every month.
Tip #3: Steady Job
To increase the chances of your Houston mortgage application getting approved, make sure you have been with your current employer for at least two years. The longer you have been at your current job, the more financially responsible you appear. If you frequently change jobs, you are showing lenders that you do not have a stable income and could potentially default on your mortgage payments. Therefore, if you are considering applying for a new job, it would be in your best interest to wait until after you have closed on your home and your loan has been signed for.
For more information on the top loan approval tips or to get started on your home loan application, please contact your local Houston mortgage lender at Austin Capital Mortgage Inc., at 512-891-0778. We are more than happy to helps clients in Houston, Austin and throughout the state of Texas!