Buying a Home is Easier Than Many Realize

Buying a Home is Easier Than Many Realize

Yes You Can

A lot of people are operating under the mistaken impression that getting a home loan has become impossibly strict, and that people with good credit scores are being denied loans. They mistakenly think you have to have 20 percent down, or that you have to have absolutely perfect credit, or that having student loans means you won’t qualify. That’s just not the case.

The fact is that it has definitely gotten easier to qualify for a loan than it was right after the financial meltdown in 2008; standards are now relaxed back to where they were in the 1990s. You can’t get a loan just because you say you’re a nice person who makes a lot of money. But you most definitely do not have to have a 20 percent down payment saved. With FHA financing you only need 3.5 percent. Fannie Mae and Freddie Mac both offer 3 percent down loans but with some requirements, while the VA has zero percent down. When you apply for a loan, you’re going to have to jump through a fair number of required hoops by providing pay stubs, tax returns and bank statements. What can you do as a borrower to make the process smoother? Provide whatever documentation they’re asking for, as soon as they ask for it.

The mortgage industry isn’t setting people up for failure. They’re in the business of making loans. They want to make loans. It’s important to remember that if you’re going to get to the finish line you just have to cooperate fully. As a borrower, you are an active participant in the process. If you do your part as best as you can, you’ll have the smoothest transaction possible. And it’s useful to familiarize yourself with the standards that loan processors follow. When a loan processor says they need two months of bank statements, if you don’t give them every single page of the statement, even the seemingly meaningless ones with boilerplate language on them, they can’t check off that they have received your bank statements.

Source: The Washington Post