How to Increase Your Chances of a Mortgage Home Loan Approval December 22nd, 2018 Comments are off for this post

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All of us wants a home of our own, even if most are not capable of paying it in full. But thanks to home loans, one can now get their dream home and only pay how much they can afford. Applying for a mortgage loan is easy, but getting approved is another topic.

If you want to increase your chances of a mortgage home loan approval, make sure to read the following tips.

Include All Sources of Income

The best way to get approved and increase your loan amount would be to include all of your income sources. This can be from your car allowance, child support, disability income if any, employment contracts and offers, foreign income, Social Security Income, Retirement, Pension, and Government Annuity and more. It’s best to check with your Houston mortgage lender to check which other sources of income can be included.

Add a Loan Guarantor

Some home loans will allow you to add a co-borrower, and you can use this to your advantage to either increase your mortgage loan rate or get yourself approved for one. For example, your DTI Ratio or Debt-To-Income Ratio is stopping you from qualifying for a mortgage, and you can ask someone (usually a family member) to help you. This way, you can add their income to your total revenue and increase your DTI Ratio.

Save Yourself from PMI

Some home loans will require at least 10% down payment apart from the other fees depending on the type of loan you’ll get. However, it’s best to save yourself from PMI or Private Mortgage Insurance, and spend 20% down payment. PMI is an insurance that will protect your lender in case you stop paying for your loan. This can prove to be costly, and you’re better off paying 20% down payment than the PMI.

Good Read: What Is Private Mortgage Insurance?

Give Your Credit Score a Boost

Your FICO score will determine whether or not your lender will approve your loan, and how much they are willing t provide for you. Check your report regularly and fix errors as soon as possible. Pay your debts on time, and better if you do it in full. Also, try not to max out your credit cards. Also, try not to make any huge purchases and avoid opening new credit accounts.

Maintain Stable Cash Flow and Save Up

Financial stability is essential when applying for any loan, so make sure that your lender will find that you have a steady flow of income and that you have job security. Stick through your employer, avoid becoming self-employed, don’t quit your job for a lower-paying and beef up your savings to secure your loan better.

Have the Required Documents Ready and Respond to Your Lender Promptly Communication is key in all negotiations, so make sure to keep your line open and respond to your Houston mortgage lender on time. This way, you’ll get to have all the information needed to get approved like the requirements, fees, costs, etc. Be sure not miss any requirement and don’t be afraid to ask questions to make sure nothing is amiss.


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