When you are looking to purchase a home, there are some things that you should really consider before you make the purchase. First, you must make sure you are ready to put down a sizable down payment for the home. Look at various interest rates for your loan. There are very many to choose from. There is a cost to closing a home, so make sure you pay that off immediately. And ask if there is any documentation you can get from your lender.
- Liquid capital is necessary for a down payment, which is typically 3.5% of the purchase price at minimum.
- A poor FICO credit score – say, below 640 – and a bad debt-to-income ratio will hurt your ability to get a loan.
- Some sellers and realtors require the buyer to be pre-approved for a loan and to provide thorough documentation.
“Understanding this information well in advance may help you make better decisions and will make your mortgage approval process to go smoothly and quickly.”