Applying For A Home Loan? You’Ll Likely Be Asked These Questions

Are you ready to take the steps to purchase a house? If so, you'll need to figure out how you are going to secure financing to cover the purchase. That's where mortgage lenders come in. Unfortunately, there is not a single loan process that works great for everyone. Here are some questions you'll likely be asked by a potential lender.

Are You Buying Your First Home? 

Many lenders will ask if you are buying your very first home for this. This is not to congratulate you on your decision, but to find a mortgage product that will work best for you. Many lenders are able to accommodate first time buyers in a few different ways. They'll start by finding any programs going on through the national or local government for discounts and incentive programs. The goal is to set you up for success so that you don't default on your first mortgage, and they'll take the steps to help guide you through it. 

Do You Have Military Experience?

If you have qualifying service activity in the military, it is possible to use a VA loan to secure the money that you need. VA loans have a lot of benefits to help veterans with purchasing a home. There are often better interest rates, more relaxed credit requirements, and home buyers can even forego providing a down payment to speed up how quickly a veteran can purchase a home. 

Will You Use A Co-Signer?

If you do not have the best credit for purchasing a home, you'll need to use a co-signer to get approved for a mortgage. A co-signer essentially takes on the financial risks when you purchase a home, which includes it affecting their personal credit. The mortgage shows up on the co-signer's credit report, and will be affected if you do not make your mortgage payments.

One thing that many people don't realize is that co-signers are subjected to the same credit requirements as home buyers. For example, if the co-signer has an existing mortgage, it may put them over the maximum requirements for their debt-to-income ratio. Using a co-signer with good credit doesn't automatically mean that you'll be approved for a home. 

Think you're ready to take the big step of buying a home? Have a few questions for first time home buying services? Meet with a mortgage lender for more information on how they can help you secure financing to make one of the biggest purchases you'll ever make.