Prequalifying Helps Determine How Much You Can Afford

Glendale, CA. Emin Andreasian – Before you seriously start looking for properties, a real estate professional with whom you have a relationship with should prequalify you to ascertain a price range that is suitable for your needs.  According to Vic Parsekhian (ABR®) “prequalification is a necessary part of the home buying process that helps save you time and money.”

He also went on to say that it is very important for prospective buyers to no withhold any information such as income or credit status.  Real estate professionals aren’t trying to pry, but rather get all the details that are relevant to the purchase and one’s ability to get the best mortgage.

By openly discussing your financial situation, you give your agent more leverage to find you the best home you can afford.  Parsekhian notes, “if you stay quiet, you are putting the real estate agent or the loan officer in a tough position.  Both the prosecptive buyer and the seller waste time and money during this whole process.”

Once you have signed a contract or commitment to purchase the property, the next step is to choose a lending organization or a mortgage company from which to obtain your home loan.  The loan application will ask the prospective buyer to provide a place of employment, their assets, and liabilities.  The loan application will also ask you to include any recurring debts such as credit card bills, school payments and/or car payments.

Speaking with the professionals from Americana and Finance, here are a few pointers they mentioned when it comes to qualifying for a loan.  1) Do not borrow the down payment without disclosing the loan, make secret financial preparations, or put forward fake letters-of-credit or gift letters. 2) Accurately list your income and assets, all debts and a rough amount you owe anything.

In most cases, you will be charged a small credit report fee ($20) by the lender, which will give the lender or the mortgage company your credit history.  Credit reporting agencies gather credit reports on consumers, past bill payments, and any legal lawsuit that either you have filed or some has filed against you.  Note, you are entitled to a summary of your credit report and a summary containing the sources of the report’s information.  If your ability to obtain a mortgage is unfavorably affected by the credit report, you have the right to challenge its accuracy and seek corrections.

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