HOW TO QUALIFY FOR A CALIFORNIA HOME LOAN
Qualifying for California mortgage loans is an important step in buying a home. Understanding the process can help ensure that you are able to qualify for the home loan that you need.
Lenders look at two things when determining if you are able to qualify for a home loan: your ability to repay the loan and your willingness to repay it.
Ability to repay
The first thing that a lender wants to know is if you are able to repay the loan for which you are applying. The lender looks at your current employment. Have you been in the same job for at least two years or at least the same line of work for a few years? This shows the lender that you have steady employment, and its a great plus in qualifying for a home loan.
The lender also looks at your total income and compares it to your debts, adding in your proposed monthly mortgage payment. You must have sufficient income to comfortably make these payments. This reflects your ability to repay the loan when qualifying for a home loan. If the lender believes your debt load is too high, you will qualify for a smaller loan and likely be charged a higher interest rate. Therefore, it makes sense to pay off as much debt as possible before applying for a home loan.
Willingness to repay
The next step in qualifying for a home loan is determining your willingness to repay the loan. Lenders determine this by looking at how you have paid off debt in the past, and it is one reason why lenders check your credit report. If you have faithfully made on-time payments toward your past debts, it helps you when qualifying for a home loan. The lender also looks at how you intend to use the property that you are buying. If you plan to live there, it is more likely that you will repay the loan.
The lender may ask you for a very complete financial picture of your life, your income, assets, credit report, etc when qualifying for a home loan. Once you provide all of this information and the lender is able to verify it, this shows the lender your ability and willingness to repay the loan, The lender is then able to help you qualify for California mortgage loans.
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HOW TO KNOW WHEN SHORT SALES ARE THE RIGHT OPTION FOR YOU
Southern California short sales occurs when the lender agrees to accept the amount less than the remaining balance of the mortgage loan. This agreement between the lender and the seller confirms that the lender forgives the rest of what was owed on the property. The seller who is experiencing financial difficulty will then have an option to avoid going through a foreclosure. Going through a short sale will damage the credit score of the seller but not as much as a foreclosure. Buyers of picks up a home at a discount while the lender avoids taking on the burden of unloading the property. Buyers may purchase Southern California short sales at a great discount but they should be willing to go through some extra paperwork and if the property needs to be fixed, then be prepared with added costs.
Sellers who choose to go through a short sale will have to comply with the following requirements like a letter explaining why they can no longer maintain the payment of the mortgage. The reasons may be the following: divorce, medical issues, financial difficulties or job loss. You need to supply proof like bank statements, tax returns and other documentations. Watch the video for further information to determine if you are suitable to go through a short sale.