The first step to home ownership is to crunch the numbers. Most sellers won’t entertain an offer from a potential buyer that has not gone through the pre-approval process. Some buyers present offers with a pre-qualification letter, but buyers with a pre-approval letter are much stronger buyers.
Home is where your story begins.
There are several things that get considered by a lender when deciding how much of a loan they will give you. We talked yesterday about your credit scores being one factor. Another consideration is your LTV (Loan to Value). This is the calculation of how much you are putting down. If you put 20% down, you will have an 80% LTV, get a better interest rate and won’t have to pay mortgage insurance. The third factor is your DTI (Debt to Income Ratio). Lenders would rather you are only borrowing around 43% or so of your available income. They take your current debts payments (car, student loans, credit card payments, etc) away from your monthly income and then will lend you up to 43-50% of the remainder.
For most, this can get pretty technical and that’s why as a real estate professional, I’ve also chosen to go the extra mile and get my Mortgage Loan Originator license to help you get your loan. My goal is to simplify your life, streamline communications, and to make sure that you not only get the home of your dreams but the best mortgage possible too!
Regan Archer Real Estate
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