Did you know the mortgage approval rate is the highest it has been since 2007? While it may be easier than ever to get a mortgage, many people settle for anything they can get. But do you know how to find the best deals?
We can help you hunt them down. Read on as we discuss our essential tips on finding a mortgage.
Get Your Credit in Shape
Having a credit score good enough to get you a loan is not the best position to be in. With bad credit, even if you do manage to get approved, you will get very bad terms and conditions. The better your credit, the more likely you are to get a mortgage with more favorable terms.
Start by paying off any debts on cards on finance plans. Set up a calendar to ensure your utility bills are paid on time. Finally, do not make any new applications for credit lines.
Work Out How Much You Can Afford
If you have a half-decent credit score, and sometimes even if you don’t, you may be surprised at how much you are offered when you find a mortgage. However, just because you can, does not mean you should. If you take the biggest amount, you may struggle to pay the money back at a later date.
One good way to check your budget is to divide the household income into thirds. Two-thirds should go on savings and your general luxuries. From the final third, deduct all your bills and payments for the month, and the remaining amount is what you can afford for payments.
Get Pre Approval
When finding a mortgage, pre-approval is not essential. However, it can give you a competitive advantage when searching for a home. It lets you know the buyer you already have the finance to buy the house waiting.
If other people are also interested in the property, it should put you at the front of the line. When finding a mortgage lender, ask if it is possible to get a pre-approval certificate.
Know Your Interest Rates
There are two types of mortgages: fixed and variable rates. Fixed rates hold the interest rate in position for a period of time. Variable rates have interest that fluctuates.
The one you choose depends on your circumstances. Always be aware of the rate the interest returns to after fixed-rate mortgage periods end.
Check with a number of companies regarding what deals they can offer. Do not just go with the best rates, but check fees as well. Companies such as IA Excellence can offer excellent rates with very reasonable fees for established and new homeowners alike.
Finding a Mortgage
In summary, a little preparation and shopping around can help when finding a mortgage. Follow these tips, and you can get the deal that is right for you. If you enjoyed this article, we have many more to help. From finance to property hunting, we can help you get your dream home this year!