Your Lake of the Ozarks Mortgage Lender: 3 Common Reasons People Don't Qualify for a Mortgage

Friday, October 20, 2017

3 Common Reasons People Don't Qualify for a Mortgage

You have decided you're ready to take the next step in your life and purchase a home at the Lake of the Ozarks. The challenge now is going to be a qualifying for a mortgage loan. Your Lake of the Ozarks mortgage lender is here to make you aware of some of the common reasons people don't qualify for a mortgage. This can help you get all your ducks in a row and be prepared for the loan approval process.

1. Bad Credit or No Credit at All.

Your credit is one of the most important factors that goes into determining if your mortgage application is approved or not. If you have bad credit or no credit at all, you could have a difficult time getting home financing at the Lake of the Ozarks. Before applying, be aware of your credit score. Take a look at your credit report and correct any errors. Make sure to pay your bills in full and on time to avoid hurting your credit. If you don't have any credit at all yet, work on building some good credit before attempting to apply for a home loan. This is why it's important to start planning early for a home purchase. It can often take some time to get your credit cleaned up.

2. Unsubstantiated Income.

Unsubstantiated income is income that you can't prove or verify is actually what you say it is. When you apply for a mortgage, your lender is going to look at your current employment and income. This factors in to how much you are able to borrow and how likely you are to make your monthly payments. If you aren't able to provide documentation of a stable income, you might have a difficult time getting approved. (This is why you shouldn't change jobs during the mortgage process either.) This is a common issue for self-employed buyers because they don't have the proper paperwork. Necessary documents include profit and loss statements, as well as tax returns that are filed properly and timely.

3. No Money for a Down Payment.

While there are programs now that require a no/low down payment, not having any money to put down makes you a bigger risk. Your mortgage lender at the Lake of the Ozarks wants to know that you have sufficient income and assets to make your monthly payment on time and in full. Your down payment is an investment, which shows you are "invested" in this transaction. While the traditional 20% down isn't necessary, you'll want to have 3-5% to put down, depending on the type of loan for which you apply. Another reason to start planning for your future home early, you need time to save for a down payment.

If you think you're ready to apply for a home loan at the Lake of the Ozarks, give me a call at 573-746-7211. I'm here to work with you every step of the way, from filling out your application to getting you through the closing. I'll discuss your options, offer competitive rates and back it up with the first-class service you deserve!

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