Qualifying For a Mortgage For Your Magnolia TX Real Estate
With housing prices and mortgage interest rates at record lows, conditions are certainly good for purchasing Magnolia TX real estate, and you may be one of the many buyers seriously looking to do so. Before you begin searching in earnest, however, it is important that you begin planning for obtaining a mortgage. Because of heightened and tightened lender requirements, your down payment, credit score, income, monthly expenses, debt-to-income ratio, job stability, and savings will all play a role in your being approved for a Magnolia TX real estate mortgage.
To help you prepare, the American Bankers Association offers these tips:
- Obtain a copy of your credit report before loan shopping. Go online for your free credit report from each of the three bureaus and examine it carefully to detect any errors/misinformation.
- Review your finances. Calculate all of your fixed monthly expenses. Include a potential mortgage payment, homeowner’s insurance, taxes, and any HOA fees. Also include obligations such as car payments, credit card debt and living expenses. Add projected home maintenance costs as well.
- Gather all documentation. Lenders will ask for a great deal of documentation regarding your salary, savings, job stability, debts, and the like. You will need to provide pay stubs for the past 30 days; W-2 forms for the past two years; bank, retirement, and investment account statements; and a listing of debts and monthly expenses. If you are self-employed, you will also have to submit two years of tax returns and possibly a profit-loss statement. Click here for a more detailed listing.
- Calculate your debt-to-income ratio. This ratio compares the gross amount of money you earn to the amount you owe to creditors (mortgage payment, car loans, credit card payments, etc.). The lower the number, the better. Lenders generally require scores at or below 36%. To figure your own ratio, use an online calculator.
- Do your homework before buying Magnolia TX real estate. Learn mortgage terms and be aware of current interest rates. Check out this free site that updates available interest rates daily and discloses the best “par rate” in your area. In addition, if you provide contact information, the site will forward that information to the local lender offering the best rate.
Whether you are new to the Magnolia Texas real estate market, thinking of moving up, or you’re an experienced investor, Pam Sitterly has the expertise, proven track record, and resources to help you buy Magnolia TX real estate for sale or market Magnolia TX homes for sale. Enthusiasm, knowledge of the area and personal concern for her client’s interests combine to make Pam an outstanding resource for your real estate transactions.
Pam works extensively to help Buyers and Sellers meet their Magnolia Texas real estate goals. For more information about buying or selling your Magnolia TX home, please call Pam at 281-723-0324 or via email with this convenient contact form.