Have you decided that you are ready to purchase your own home, and are taking your first steps into applying for a mortgage in order to help finance your property? Mortgage lenders take many factors into consideration during the loan application process. If you are interested in purchasing a home in Knoxville, Maryville, Lenoir City, Oak Ridge, or Gatlinburg, Tennessee, and want to learn more about the mortgage application process and what mortgage lenders look for, Foundation Mortgage is here to help. Contact our loan specialists today for a consultation.
Applying For a Mortgage
Mortgage lenders will evaluate many different factors when a potential home buyer applies for a mortgage. Lenders are primarily concerned with a borrower’s capability of paying the loan back, they want to take on minimal risk when taking on a borrower. If you demonstrate that you have the ability to make timely monthly payments, lenders will more than likely be willing to offer you home financing. There are certain steps you can take in order to help prepare yourself for applying for a loan, such as getting prequalified. Prequalification for a loan can help you get an idea of what you can afford and help you prepare for the actual mortgage application process. If you have good credit, a steady income, and are able to put down a significant amount of money for a down payment, you will likely be able to secure a home loan.
What Mortgage Lenders Look For
When applying for a mortgage, lenders will consider many factors, including:
- Credit history – You will have a better chance of getting a loan if you have a higher credit score. Lenders will analyze the amount of credit you use in relation to your available credit limit, as well as your payment history.
- Income – lenders look for borrowers who have consistent income and steady employment. Lenders will require two years of past tax documentation and proof of employment
- Down payment – mortgage lenders will evaluate the amount you are able to pay for a down payment. A 20% down payment is ideal, and will more than likely secure you a mortgage, however, you can still qualify for a mortgage if you put down less than 20%.
- Assets – Mortgage lenders will want to take a look at your bank statements and other investments such as retirement accounts, stocks and bonds, etc. Having additional assets ensures the lender that you have the means to afford monthly mortgage payments.
Getting Help With the Mortgage Application Process
If you are beginning the mortgage application process in the areas of Knoxville, Maryville, Lenoir City, Oak Ridge, or Gatlinburg, Tennessee, contact Foundation Mortgage today. We can help you better understand what mortgage lenders are looking for and help you be prepared for the mortgage application process. Get in touch with us today for a consultation.