There are many reasons to invest in a home. For each of those reasons, the experience being a first time home buyer can be a thing of both anxiety and joy. Still, buying a home is largest investment that many people will ever make. Not only does buying a home come with a hefty price tag, it appreciates in the dividends of your life’s experiences. This is why home loan lenders do not want to help people buy just any home, but rather those lenders prefer to help people buy the perfect home. How those home loan lenders help you is entirely in your power.
So what do you need to know about getting a mortgage to help your pursuit of that perfect home?
First, the housing market is on the rebound. In October of 2012, California home sales rose by 25.2% over the sales only a year prior. This level of growth was a five year high for California, and similar gains have the California housing market climbing back up to its former health. This matters to the average homebuyer, because these great numbers are the result of new and in many cases more stringent home loans qualifications.
Banks are being more prejudicial than they were prior to the burst of the housing bubble and subsequent recession. Lenders are being more strict about who they lend to and how. Many lenders will go over an applicant’s financials looking for unusual deposits, which may be the difference between being approved and getting turned away.
Knowing what you are up against is only half the battle. The second and more crucial part of the application process is to know your options and to shop around. Finding a suitable mortgage does not begin with an application. Rather, the best way to begin a search is with a little know how. There are alternatives to traditional first time home buyer requirements. In fact, finding a first time home buyers program that is right for your situation can be a great option as you move forward in the mortgage lender search.
While traditional, private lenders may have a certain level of added autonomy to approve or deny your loan application, FHA home loan lenders have some positive attributes of their own. FHA loans are mortgage that are backed by the Federal Housing Administration. The FHA home loans do not abide by a minimum credit score rule of thumb. Instead, the prospective borrower’s credit rating is evaluated given based on context. If there are reasons for a lagging credit score, then this option can be a great way to attain the funding that you need.
Another alternative to look into are VA home loans. These loans granted on behalf of the Veteran’s Administration are provided by private lenders. These specialized home loans act to guarantee a portion of an individual’s loan. This act allows lenders to grant larger loan amounts.