Mortgage Applications

It may feel like a very daunting task to consider buying a home after you’ve declared bankruptcy, and there’s no doubt that it’s an uphill battle. Fortunately, while you’ll have hard work ahead, there are things you can do in order to make your dream of home ownership a possibility. Whether you’ve just declared bankruptcy or some time has passed, here are some things you should consider before getting into the market.

Wait It Out

It might not be what you want to hear, but it’s, unfortunately, the case that you’ll have to wait at least two years before you purchase a home following bankruptcy. Since lenders will not want to take the risk on someone that has proven to have poor financial habits, they will require a waiting period in order for the credit risk you pose to improve. While this may seem like a long time, take the opportunity to improve your financial habits so you can be amply prepared when the time comes.

Build Up Your Credit

In order to own a home, you’ll need to develop some solid financial habits, and that means getting on top of your finances even in times when it feels like you have no leverage. Ensure you get a copy of your credit report and, if you notice any errors, reach out to the credit bureau for corrections. It’s also a good idea to consider applying for a secured credit card and ensure that you pay all of your bills on time. While it might feel like a lengthy task, developing good habits will have a positive impact on your credit over time.

Prepare For Your Payment

When it comes to a poor credit history, you’ll need to pull out every stop you can to that convince lenders that you’re a solid financial bet. Instead of wasting the time, write up a budget for yourself and save a sizeable sum for your down payment each month. It’s possible that 10 or 15% down will do, but a 20% payment will help you avoid private mortgage insurance (PMI) and will go further in convincing lenders of your reliability.

It’s more than a little disheartening to have to deal with bankruptcy, but by waiting it out and developing good financial habits in the interim, you’ll be well on your way to buying a home. If you’re currently preparing to purchase, contact your trusted mortgage professional for more information.

There are few things better than finding your dream home and being able to afford it, but simply because you’ve found the perfect place doesn’t mean you should stretch the truth. It might seem tempting to polish your mortgage application a little in the hopes of making a better impression, but here are a few reasons why you should stick to the truth when signing off on your home.

Your Credit History Tells All

It can be tempting to bump up your salary or make some hefty deposits into your savings account. However, lenders will be taking a look at your financial history by way of your bank statements, credit report and paystubs so they’re likely to discover any erroneous details. If you’re not honest about your financial situation, the lender may suspect that you’re not a reliable buyer. Not only that, making false statements about your finances may give you more home than you can really afford, which can cause setbacks down the road.

Mortgage Fraud Is Still Fraud

A little white lie on your mortgage application might not seem like such a big deal, but because you are painting a picture of yourself that is not true, this can actually be considered mortgage fraud. While there are mistakes that can be made on any mortgage application given all the details required, it’s very important not to mislead the lender or home seller on purpose. It may not be common, but mortgage fraud can be punished with hefty fines or even prison time.

A Bad Way To Begin

There’s nothing like the feeling of moving into your newly-purchased home and feeling enthusiasm for all the things it entails, but being dishonest about your financial situation can sully that. A lie may just be a small detail, but mortgage lenders look at a variety of factors to ensure you’re a good fit for a loan that will stay manageable month after month. While a minor mistruth may seem insignificant, it disables lenders from being able to assess if your financial situation is right for the home you want to purchase.

It may be enticing to fudge a few details on your mortgage application, but there can be serious implications involved in not being honest about the information on your application. If you’re currently in the market for a home, contact one of our mortgage professionals for more information.

There are more than enough details involved in getting a mortgage and moving into your own home that you’ll want to know how to make the process as seamless as possible beforehand. However, there’s a chance you might not be aware of the things you can do to make it a little easier on yourself. If you’re currently looking for a home and are wondering how to streamline the approval process, here are some things to do before applying to minimize mortgage-related stress.

Get Electronic Documentation

In order to get approved for your mortgage application, you’ll need to provide documentation that will likely include bank statements, federal tax returns and recent paystubs, but providing or acquiring all of these documents in paper form can require a lot of drudgery. Instead of paper, get your documentation together and ensure it’s in electronic form so it can be easily accessed or sent from anywhere. This means you’ll have it on hand as soon as it’s needed.

Choose A House You Can Afford

As a potential homebuyer on the market, it’s easy to be swayed by your dream home, but if your dream home doesn’t come with an acceptable price tag, it’s important to move on to the next best opportunity. It can be very easy to be invested enough in a particular home that you can convince yourself you’ll budget for it, but the market can shift and this can push your monthly payment from difficult to not-doable. Choosing a home at an affordable cost will not only improve your chances of approval, it will also minimize your stress after the move-in date.

Have Your Down Payment Ready

It may be all well and good to know that your down payment money is in the bank, but it’s important that it’s in the appropriate account at least 3 months prior to your application submission so you can ensure you’ll be seen as financially sound. While it’s great to have money held in investments and RRSPs, it’s important that this down payment money is kept in an easily accessible account where it can be withdrawn without any time delays or financial losses.

There are many different steps and small details associated with obtaining a mortgage, but by having your electronic documentation and down payment ready, you’ll be well on your way to an approval. If you’re currently on the market for a home, contact your trusted mortgage professional for more information.