The Ultimate Stress-Free Guide to Getting a Mortgage

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Buying a home is one of the biggest financial investments you make in your adult life – and getting the right mortgage is the key to ensuring that process is as stress-free as possible. The good news is that finding the right lender is fairly easy – especially when one comes highly recommended (queue one of the Triangle Area’s top loan officers, Reed Lester).

However, without a strong recommendation, some planning and a little shopping around needs to take place, as the time invested is well worth the results. Afterall, when it comes to buying your dream home, you have a lot riding on your loan specialist. Since market conditions and mortgage programs change frequently, it’s important to make sure you’re dealing with a top professional who is able to give you quick and accurate financial advice. 

So, if you’re new to the home buying and mortgage process, and not quite sure what steps you need to take – don’t stress. Our team of home selling and buying experts put together this guide to make the process less stressful, so that you can focus on looking for a home and the buying process with your real estate agent

Prepare Your Finances

If you have great money management skills, low debt and a high credit score, you could look for a house at any time. If this does not describe your situation, take some time to improve your financial stability. Not only will you be able to qualify for more money (more house), you’ll also get better interest rates. That said, try to never max out the full mortgage limit your lender offers.

Save for Mortgage Costs

When looking into purchasing a home, many people feel they first need to save 20% of the sale price before approaching a bank. There are loans out there (FHA, VA, etc) that only require down payments of 3% to 3.5%. In some cases, you might not need to make a down payment at all. Other costs you should save for include mortgage fees and closing costs.

Choose a Mortgage Type

There are several different types of mortgages available that you’ll want to become more familiar with. The type of mortgage you choose could determine the lender you work with, so choose wisely:

         Conventional loans work best for homeowners with high credit scores and big down payments saved (typically requires 20% down payment).

        FHA loans work best for first-time homebuyers with modest savings and good to fair credit scores (requires 3.5% down payment).

        USDA loans work best for homebuyers looking to purchase properties in rural areas (as low as $0 down).

        VA loans are available to some veterans and service members and offer the best terms for these demographics (as low as $0 down).

        Jumbo loans become necessary when loans exceed the pre-approved limit for conventional loans in that area (as low as 5% down, but usually 20%).

Shop Around for Lenders 

Financial gurus say you should get quotes from at least three lenders before making a decision. This is great advice. When shopping around for lenders, you also get a good idea of what you can afford based on the interest rates quoted to you.

If you are already working with a real estate agent, this is also a great resource in finding a great lender, as they will recommend one who will work with them in your best interest and may have worked with in the past. 

Get Pre-Approved

Preapprovals provide more accurate details on what you can afford. This reduces the likelihood of future hassles in the mortgage process. It also reduces stress in the homebuying process and allows you to present a winning offer vs. other home buying contenders who have not been pre-approved.

Work With The Triangle’s Top Team 

At Five Over Four Realty, we are eager to help our clients through every step of the home-buying process. If you have questions or you’re ready to move forward with the house-hunting stage, contact us online or call our team directly at (919) 208-4719 today!