Key Mortgage Issues!

The pendulum always swings away from problems but never in moderation. Obtaining a mortgage has become much more of an arduous proposition than years past. This is in response to lender practices of issuing mortgages to less than qualified borrowers. So because of their lack of professional discipline and perhaps ethical standards, the housing industry and those wanting to buy a home will suffer. Lenders will concentrate on six key areas which borrowers should know about and be ready:

1. Credit Score - know your credit score before applying; have a credit score above 700

2. Income & Assets – make sure you have documentation for all income sources and verifiable assets. Lenders will look closely at this information as if you were going for a top security clearance.

3. Information requirements – the financial industry is in a state of flux with new regulations imposed almost daily; regulations changing almost hourly; imposed on borrowers every second. Be flexible and respond to their requests quickly.

4. Appraisals – real estate is based on a seller willing to sell at a price and a buyer willing to buy at that price. Now appraisals are destroying the deal. If the agreed upon price is higher than the appraisal, the lender will not approve the loan. This causes a spiral effect that will be difficult to break. Lenders do not factor in the fact that families want to live in a home and the purchase is not an investment but a place to raise a family.

5. Self employed – as long as you can verify your income, you might get your foot in the door!

6. Condominiums – many condominium associations are having financial difficulties because of owner delinquencies. Lenders now also have to approve of the association before approving the loan. In your search for a home, do your homework on the association as well. Pre-approved condominium associations by lenders are the best.

If you pass the above along, this may help those in their quest of being approved for a mortgage.