Buying a home at Lake of the Ozarks is a big step. Whether you're a first time home buyer at Lake of the Ozarks or you're a seasoned buyer, Team Lasson is here for you! We get asked a lot of questions on financing on a regular basis and we want to help answer those questions! Check out our answers to our frequently asked questions below:
What Should I Do to Prepare to Buy a Home?
Before starting the purchase process, it's best to work on improving your debt to income ratio. You can also work on improving your credit score. It's also a good idea to start saving for a down payment. When you're ready to start home shopping, it's best to get pre-approval for a mortgage so you have a good idea of the price range to search within.
Can I Still Qualify if I Have Bad Credit?
There are a number of factors involved in securing a mortgage loan. Your credit score is one of those factors but don't let a bad credit rating keep you from trying to get approved. A mortgage lender will be able to provide options, depending on your current credit situation, as well as offer advice on ways to improve for a future purchase.
Who Pays for Closing Costs?
Closing costs are the fees required to process the transfer of ownership of a property. Both the buyer and seller have fees they are required to pay to complete the transaction. These costs can be negotiated in the offer as to who will actually pay for them.
What Kind of Loan is Best for Me?
There are numerous options for home loans and the right one is not a one-size fits all answer. A lender will be able to help evaluate your current situation and advise which loan type works best for you.
How Much Can I Afford?
Your loan officer will review your financial situation, pull your credit report, and help you determine what price range you can afford. Just because you can afford it may not mean you are comfortable with the payment so it is important for you to also review everything to determine what you are able to afford. Just counting your mortgage payment is not enough because you need to save money aside to plan for any repairs and improvements for the future.
How Much Money Do I Need for a Down Payment?
It’s a common misconception that you have to save a lot of money for your down payment—20% is usually the number you hear about. While a 20% or more down payment will allow you to avoid paying Private Mortgage Insurance, plenty of people are able to qualify for loans with lesser down payments. The loan program you qualify for will determine the amount of your down payment. Down payments for conventional loans can range from 5% and higher, while some government loans, such as FHA, VA or USDA Rural Development loans may require as little as 0% - 3.5% down.
When Should I Get Pre-Approved?
In today’s housing market, it is always a good idea to get pre-approved. This is a more in-depth process than getting a pre-qualification from a lender which usually is just a review of your credit report and the information you list on your loan application. A pre-approval is where your loan officer gathers all your financial documents and submits your file to underwriting so they review, validate and approve your file. Then you only need to find a property and wait for an appraisal, inspections and title work. This can help you when negotiating in a multiple offer situation because the seller will know you are serious and have already been approved to buy a home. Your pre-approval will typically be good for 90-120 days.
What is Required to Get a Loan?
Your loan application will be evaluated by your lender based on your credit, debt, assets, and income. Most loan programs require proof of income and assets, such as paystubs, W-2’s, and bank statements; however, each borrower’s situation is different and may require additional documentation. Self-employed borrowers will be required to provide personal and business tax returns, Profit and Loss Statements, and Balance Sheets.
Why Does My Credit Score Differ From What My Lender Gets?
Most credit reports that are available to the consumer for free or at a minimal charge will only reflect your credit history for the most recent 12 months. Mortgage lenders are required to pull a tri-merged credit bureau that reflects your entire credit history from the beginning.
If you're itching to purchase property, there's a good chance you'll want to learn about the options available for financing at home at Lake of the Ozarks. Our experienced mortgage lender in Osage Beach, MO is here for all of your home buying needs! Give us a call at (573) 746-7211 or visit our website at www.yourlakeloan.com to get started!
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**The postings on this site are my own and do not necessarily represent First State Bank of St Charles’s positions, strategies, or opinions.
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