How to Get a Mortgage in Today's Economy
- 1). Get a copy of your credit report and review it closely for mistakes before applying for a loan. Every year, each person can get an annual credit report for free at annualcreditreport.com. Dispute any mistakes in the credit report, and allow approximately one month for changes to be reflected in the report before applying for a loan. This ensures the best possible credit score.
- 2). Look into government loan availability. Most houses are eligible for Federal Housing Administration loans or similar government loans. These usually have certain limitations which vary by state, the type of building and the reason for the loan, but they can be a great way to get low down payment loans. An example of the building variation qualifications can be seen with condos, which require 90% of the complex be owned by private home owners and at least 51% of the complex is occupied by the owners. Houses usually can get FHA loans as long as the owner intends to live in the house.
- 3). Talk to local banks. The banks will require a credit check, tax returns, picture identification and proof of income before they will give loans. Keep in mind that they limit the loan amounts based on income. Typically, a mortgage payment around 1/3 of a paycheck or less per month is an acceptable amount. Some banks will require at least one year of employment before giving a mortgage.
- 4). Shop around at a few banks. It’s important to get the best possible interest rates, no matter what the economy is doing. The economy will rise and fall every year, but interest rates on a fixed interest mortgage will remain the same.