How do you know you are truly ready for a home loan? There are many things to consider, including your finances, credit, and employment history. But there are other factors, too.
You Are Not Ready For An FHA Mortgage If You Don’t Know How Much You Can Afford To Pay Each Month
Do you know how much you can afford in a monthly mortgage payment?
Don’t forget that calculating your payment isn’t as simple as doing the math on the sale price of the home compared to the length of the mortgage plus interest.
You will also have to figure in property taxes, any applicable homeowners or condo owners association fees, mortgage insurance premiums, and other factors. Do not overlook these expenses when doing the mortgage math!
You Are Not Ready For An FHA Mortgage If You Don’t Have Down Payment Funds
Saving up for a down payment takes time and even if you plan to seek down payment assistance, this too takes time and you will have to learn whether you qualify for the assistance based on the local programs available in your area.
Remember, the FHA and the lender do not offer down payment gifts. No party that is financially associated with the transaction may give you a gift of down payment money.
That goes for the seller, the lender, and others who have a financial interest in the transaction.
You Are Not Ready For An FHA Mortgage If You Haven’t Looked At Your Credit Report In The Lasts Six Months
Borrowers need to fully understand the contents of their credit report at the beginning of their home loan journey or as soon as possible after it starts. Never underestimate the power of the unexpected, especially when it comes to your credit.
You may discover evidence of identity theft, erroneous information, or other problems on the report that need to be corrected.
Those corrections take time no matter who may be at fault, and you will find your home loan process delayed significantly if you are working on getting those issues fixed at the same time you are actively working with a lender to get a home loan.
Consider the FHA’s advice to seek home buyer advice from a housing counselor. You can learn about housing counseling and how it can assist you by calling the FHA at their toll-free number, 1-800-569-4287.
Housing Counseling is a valuable resource for first-time home buyers, you can learn a great deal from a seasoned professional in this area.