If you own your own business, you may have wondered whether this could make qualifying for a mortgage more difficult. And while you may have different considerations to keep in mind than a W-2 employee buying a home, with the right mortgage and real estate professionals by your side, you can achieve your dream of home ownership. Here are 4 tips for buying a home if you’re self-employed.
If you’re self-employed, the home buying process may seem daunting; but it doesn’t have to be! With careful preparation and planning, you can make your homeownership dreams a reality. If you have any questions about qualifying for a mortgage, contact one of our licensed Mortgage Loan Originators. If you are ready to begin the home buying process, click here to get started!
We recently discussed the fourth step in the home buying process: applying for the loan. Once you apply for a home loan, your Mortgage Loan Originator will submit all of your documentation to Processing, and from there, your loan will be sent to Underwriting. These are crucial steps, and it is important to understand some of the factors that go into getting your home loan approved.
Processing
Once you have submitted all of the required documentation for your loan application, your Loan Originator will submit everything to Processing. The Processor puts all of the documentation together for Underwriting, and works closely with the Loan Originator to ensure a smooth process. They will order a title search to make sure that the seller has legal rights to the property, and schedule an appraisal to determine the value of the property. Based on information received, the Processor may reach out to the borrower for any additional documentation needed. Once all of this has been completed, the Processor will send the application to Underwriting.
Underwriting
In the underwriting process, the lender determines the degree of risk involved with lending the consumer money. Here are the “Four C’s” that the Underwriter will evaluate:
Once the Underwriter has approved all applicable documentation, and determines that the loan is a good fit, a clear-to-close (CTC) will be issued, allowing the loan to move into the final stage of the process: closing on your new home.
If you have any questions about the home buying process, contact one of our licensed Mortgage Loan Originators. If you are ready to buy a home, click here to get started!
Recently, we discussed the first step in the home purchase process: getting pre-qualified. Getting pre-qualified allows you to enter the home buying process prepared, with a budget in mind. Once you’ve been pre-qualified, the second step in the home buying process is to choose your mortgage loan type.
Fixed-Rate vs. Adjustable-Rate
Mortgage loans are split into two types: fixed-rate and adjustable-rate. A fixed-rate mortgage has the same interest rate for the length of the mortgage term. Fixed-rate mortgages are usually available in either 15- or 30-year terms. The 30-year fixed rate mortgage is the most common type of mortgage.
An adjustable-rate mortgage has an interest rate that is usually fixed for a set period of time, and then periodically adjusted according to a specific benchmark. Many factors determine how the interest rate changes, including market conditions, financial index, etc.
Whether you should choose a fixed-rate or adjustable-rate mortgage depends on your personal financial situation, how long you plan to live in your home, how quickly you plan on paying your mortgage back, and many other factors. Your loan originator can help you determine which type will work best for you.
Loan Programs
Once you have chosen the type of rate that is best for you, you can choose a loan program. Some of the most common loan programs are:
For a more comprehensive list of loans and their requirements, contact your mortgage loan originator.
According to Gladys Marcelin, NFM Lending Georgia Branch Manager, the most important factors to take into consideration when choosing a loan program are your credit, your income stability, and your available assets. Your loan originator can work with you to choose the loan program that best suits your needs and financial situation.
In addition to working with a knowledgeable professional, educating yourself on the mortgage process is important, especially as a first-time homebuyer. Gladys recommends attending a homebuyers’ seminar, especially if you are a first-time homebuyer, to learn more about home loans and buying a home.
“Buying a home can be a tedious process, but it can also be rewarding and is a great accomplishment,” says Gladys.
If you have any questions about loan programs or the home buying process, contact us. If you are ready to start the home buying process, click here!
Home inspections are a very important part of both the home buying and selling process. It is always a good idea to hire a Home Inspector to properly inspect a house. Home Inspectors are professionals who are trained to have a keen eye for catching things that a normal homeowner (or potential homebuyer) may not notice.
Here are some of the things that a professional inspector might check for:
Although a home inspection costs extra money and may not be the most exhilarating experience, it is necessary when buying a home. It is in your best interest (and for your own safety) to have a professional look over the home before you purchase it. Even if a house looks to be move-in ready, there could be hidden issues throughout the house.
If big issues are found by the Home Inspector, speak with your Real Estate Agent. In some cases, your Agent can work with the seller’s Agent to have some, if not all, of the necessary repairs paid for by the sellers. This could be done by either the sellers paying for the repairs prior to the home being sold, or by giving the buyer closing cost assistance at the time of closing. If the seller is not willing to assist, talk to your Mortgage Loan Originator to see if you will have enough money available to make the necessary repairs after closing, or if you need a home improvement loan to be able to afford the repairs. If the costs end up being overwhelming, it might be best to speak with your Agent and move on to another property.
For more information regarding home inspections and their benefits, click here.
If you are looking to purchase a home, contact one of our Licensed Mortgage Loan Originators today to pre-qualify and begin the home searching process with confidence.