When you plan to buy a home there are some distinct steps you should take first in preparation for shopping for Fresno home loans. In fact, these same rules apply whether you are applying for a new home loan or refinancing an existing loan. Making sure to take the following steps prior to refinancing or shopping for a new home loan will help the process go much smoother for you.
Get Your Credit in Order
When buying a new home or refinancing an existing mortgage, it is important that you make sure your credit appears to be in order. If there are errors on it that are negatively affecting your credit, you will want to take care of these prior to applying for your loan. If these errors are not corrected, you may not qualify for the loan amount that you need, which may mean that you are stuck with your old mortgage payment or are not able to qualify for the home you want.
Note that changes to your credit may take several weeks to process, so get started on this early. You can expedite the process with the different credit bureaus, but there will likely be a fee. If you have high balances on your credit report, such as any credit cards with a balance that is within 30 percent of your total spending limit, pay these down as much as possible prior to submitting your loan application.
Talk to Your Lender about Available Programs
If you are worried about your down payment or closing costs, talk to your lender about available programs that will help you refinance or get into a home with no money down. There are even some programs that will help you pay your closing costs, as the seller will not always pay these. You will want to talk to a professional about any options that might be available to you as there are usually conditions and requirements that need to be met in order to qualify.
Reconsider the Term of Your Loan
If you are able to afford a higher monthly payment, perhaps you should reconsider the term of your loan. While most mortgages have a 30-year term, there are 15 or 20-year mortgage loan terms that will carry lower interest rates. The balance will be higher because the term is shorter, obviously, but if you can afford it, you will be paying significantly less towards your interest and more towards the principle balance of your mortgage loan. You can therefore save a lot more money over the entire term of your loan this way, so if saving money and paying off your balance quicker interests you, talk to a Fresno home loans professional today.