When the time is right for you to buy a home, make sure you are financially fit and eligible for the best possible mortgage rates. Here are our top five tips to boost your “financial fitness”:
1. Whip it
Whip your credit rating into shape: pay your bills on time… every time. Keep your oldest credit card for its history, and make sure it’s always paid on time. Try not to apply for any new credit.
2. Follow the 33% rule
Never run up a credit card or line of credit past 33% of its available limit. If you’ve got a $3,000 limit, then $1,000 is your absolute ceiling.
3. Cash is king
Gather up the maximum downpayment possible. The more money you put down on a home, the better.
4. Be prepared
Put together a file folder with the following: pay stubs, or proof of self-employment income, list of debts and assets, and current bank statements. We can advise what you’ll need.
5. Start a dialogue
Talk to a mortgage broker & Realtor about your plans. Find out if you can pre-qualify, and ask about how you might qualify for the best possible rate.
The process of qualifying for a mortgage begins long before you decide to buy a home! But if you make a plan to improve your financial fitness… you’ll have no shortage of lenders willing to compete for your business.