Most potential homeowners need a mortgage to fund their purchase. However, getting a mortgage approval is not a walk in the park. There are numerous factors that influence your loan approval.
Working with a mortgage company with competent mortgage planners in South Jordan to handle your loan application process is one of the ways you can improve your chances of getting approved for your loan.
The amount of your down payment and credit history are some of the common factors which influence your loan approval. Apart from these, here are the other key factors.
Unstable Employment History
Your employment history proves your stability and ability to repay your loan. Most lenders prefer borrowers who have had a stable job for over two years and worked in the same field for some time.
Some lenders have a pre-approval clause that states you should not change your employer before the mortgage closing. They might also ask you for evidence of employment at your mortgage closing.
If you have other loans you are currently servicing, it might lead to rejection of your application or reduce your loan amount.
Consider paying off your car as well as student and installment loans before applying for a home loan. Most lenders will also consider your direct responsibility for any loans you have co-signed.
Real Estate Holdings
You need to disclose upfront if you own rental properties or a vacation home. Lenders treat rental income differently as it applies to your debt service ratio. Add-backs and rental properties might decrease your loan amount to some extent and hence should be carefully considered.
Building societies and banks are typically less willing to finance mortgages for older borrowers. Borrowers above fifty years can, however, increase their chances of approval by proving their ability to support the loan. This typically requires proof of regular earnings from their investments, insurance policies and pensions.