First time buyers often opt for mortgage financing in Galloway, New Jersey when buying their first property. Here are pointers that you should remember when getting such a mortgage.
- 1. Know your credit score
Your credit score is what financial institutions will take a look at before granting you a loan. When you have a higher credit score, your chances to be approved with the loan is also better. Make it a habit to know your annual credit score, not only when you are about to get a mortgage for a major purchase. Knowing your credit score early on can also help you do something to improve it if such a score is low.
- 2. Know how much you can borrow
Different lenders use different ratios and criteria when granting loans to clients. You need to have an estimate as to the amount you can borrow from the lender. This way, you can also determine if such amount can cover the price of the property you are about to purchase.
- 3. Know how much you can afford
At times, first time property buyers get carried away by their emotions after seeing an aesthetically pleasing or spacious property. They often forget to think about whether they can afford such property or not. Remember, you need to pay back the money you will borrow from the lender at a certain period plus interest. Knowing how much you can afford, preferably in terms of monthly payment, can help you know whether you can also afford the property or not.
- 4. Get preapproved for a mortgage in Galloway, New Jersey before searching for properties
This will let the property seller know that you are serious in your purchase. They can also see your financial capacity to pay. Although it is not a requirement to get preapproved, it can be beneficial to you as a buyer.
- 5. Gather all necessary documents
A lot of documents are involved in purchasing a property, let alone applying for a mortgage in New Jersey. Before visiting a lender’s office, it will be a good idea to ask about their requirements and prepare the documents beforehand.
- 6. Check the rates
The rates from various lenders may vary. Shop around to locate the best rates. Do not settle for the first mortgage rate that is offered to you. Even a small difference in two rates can already result in extra savings.
- 7. Save up for different costs, most especially the downpayment.
Ideally, a property’s downpayment is equivalent to around 20% of the property’s total purchase price. Aim to save up for the downpayment or higher than that. When you shell out more for the downpayment, this will result in a lesser amount to be borrowed.
All Mortgage Funding provides loan options for home buyers. Talk to us today and see how we can help you secure a loan application for your dream home.