Californians who have been planning to buy their first home may now fulfill their dreams of owning a property in California. The California Association of Realtors (CAR) said in an online report that the home prices have softened since 2014, with lower interest rates offered to reinvigorate home buying in the state this year.
The first quarter of 2015 also saw the rise of consumers at 34% from the same quarter of last year who can afford average-priced single-family houses, with a Median home price of $442,430 at the composite interest rate of 3.98%.
Housing affordability this year has reportedly been the highest since the second quarter of 2013. Despite the market’s favorable conditions this year, many homebuyers still concern themselves whether they would qualify for a loan mortgage, or not.
Basically, lenders evaluate the 4 C’s in mortgage qualifications, namely, credit, capacity, capital, and collateral. Personal income and savings, employment history, and monthly obligations determine a buyer’s capacity to pay today and in the future. Financial reserves like investments and other assets will also show that the buyer may have other sources for debt payments.
Your credit history will also be reviewed to see how well you pay your bills on time. For this reason, it’s encouraged to maintain a strong credit for future loan entitlements. After the first three requirements are examined, the collateral or the worth of the house that you want to buy will be assessed and determined whether or not it matches your purchasing power.