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Helpful California Mortgage Tips

california mortgageAcquiring a mortgage is not as tricky as some people think. Buying that dream home does not have to be a challenge since it is possible to improve your odds. The most important thing to remember is that you have to be attractive to lenders as much as possible in order to obtain the best deal. Here are the top 6 California mortgage tips on how to improve your chances of getting the perfect deal.

Boost your creditworthiness
Because a lender will most likely consider your credit profile first, it is crucial that you enhance your creditworthiness. As you start preparations to buy your new home, ensure that you do not forget to manage your current debt responsibly. Make it a point that you pay your bills on time without fail. Also, in order to lessen your outstanding balances, try to pay more than the minimum. Usually, lenders prefer borrowers that have a debt-to-income- ratio of less than 36%.

Start saving for the down payment
It is important to note that even though 20% is the most recommended mortgage down payment, it is not a mandatory percentage. Most lenders will expect you to put down as a minimum 3%, apart from the 3.5% down payment required by the Federal Housing Administration. That said, in order to build substantial equity straightaway, go to the lender with as much cash as you possibly can.

Seek out preapproval
Obtaining a mortgage preapproval is necessary before you start looking for your ideal home. Basically, this is a process that helps to decide the amount of money a borrower can borrow to buy a house. The moment you get preapproved, you will know the price range you need to focus on. In general, borrowers qualify for a loan that is approximately 3 times their gross annual salary.

Look for a lender
Finding the perfect mortgage lender is also very important. Because lender fees vary, it is necessary to obtain loan estimates or quotations from various lenders before making the final decision. Take your time to do this; carry out as much research as you can about the various lenders before choosing one.

california mortgage1Examine the various loan types
Examining loan types is necessary because not every kind of loan will suit your situation. For instance, a fixed-rate mortgage is not suitable for every buyer. The same is true for an adjustable-rate mortgage. Maybe you are looking for a home where you can raise a family. If that is the case, a 30-year loan could be the most appropriate choice. However, if you know that you will be moving in a couple of years, the best choice would be an adjustable-rate mortgage.

Take into account your lifestyle
When buying a new house, it is not only the financial aspect that you need to consider. Also take into account the kind of lifestyle you want for the years to come. For instance, if you are planning to start a family, you need to make sure that you are near good schools. Also consider the safety of the area, weather patterns and how far you will have to drive to work among other things.

If you follow the California mortgage tips discussed above, buying that dream house will not be a tricky process. We have covered most of the important information in this article, for more information, check out our source.


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