Getting a reasonable mortgage on your first home purchase might seem extremely difficult, but it shouldn’t always be that way. There are various methods you can employ to improve your chances of getting approved for one, with some of them outlined here.
Get First Dibs on Your Credit Score
If there’s one thing you would never want to happen, it’s the lenders getting a look at your credit score before you yourself can even check it out. Your foremost goal is to convince lenders that you’re financially responsible enough to pay back your mortgage, so you’ll have to iron out any issues in your credit history (late payments, etc.) before they look at it. The best thing is, you check your credit report for free provided you know who to approach.
Try accumulating liquid assets (assets which can be quickly converted to cash with minimal impact) which a lender can verify as an indication of your financial stability. Examples of liquid assets include retirement accounts, bonds, a 401k, IRAs, stocks and life insurance policies with cash value.
Settle Your Other Debts
Get into the habit of repaying your credit cards, store cards, catalogue accounts and overdrafts as soon as possible. Lenders take into account the amount of remaining debt you have along with the monthly payments you make, while gauging whether you can actually afford the mortgage. Having less of such kinds of debt have the potential to increase your chances of getting a mortgage.