What You Need To Know Before Applying For A Home Loan

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We know buying a home is an exciting experience but that it can also be confusing and even stressful. Our goal at INSOUTH Bank is to make it a pleasant and easy transaction for you. We do our best to prepare our customers for what may happen. Here are some tips for what you’ll need to know ahead of time.

Your Budget

Most people don’t have unlimited funds so knowing exactly how much you can spend is important. Consider how much you’re spending currently on rent or your mortgage and don’t increase it too terribly much. Your Banker can help you determine the price range in which you need to stay so you can keep your monthly budget intact.

Interest Rates

Shopping interest rates is important because they are a factor in your monthly payment. Get the absolute lowest interest rate you can and lock it in. Your credit scores will affect the interest rates you receive so try not to open new credit cards if you’ve already got a couple open.

Credit Accounts

As mentioned previously, credit scores affect your interest rates, but most importantly they affect your ability to get into the house you want. Each year, a free credit score and analysis is available to every consumer. Before applying for a loan, pull these reports yourself and check them. Dispute anything on the report that isn’t yours and close any accounts that you don’t use. Leave major credit cards open but pay them down as much as you can before applying.

Down Payment

Saving for a down payment is very important. The more you have for a down payment the more likely you are to get your loan approved. If you’ve got a really good credit history the bank may make an exception. It’s a good idea though to have some down payment for the sake of the monthly payment amount.

Closing Costs and other fees

You’ll want to consider how much cash you’ll need for closing costs and any other fees that come up during closing. Not being ready with this money could affect your loan. You wouldn’t want to lose your loan because you weren’t prepared.

If you’re considering purchasing a home and have further questions, contact one of our INSOUTH Bankers today!

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