If you have finally decided to leave the old apartment and begin anew, there’s good news for you. Generally, the first-time homebuyers go through a series of unfortunate events to get the required homeownership. The first and foremost hurdle is the credit score. Because of having a low credit score, your application for the conventional loan may be rejected. At this time, you will undergo a difficult time to find an authentic mortgage lender as well.
Mortgage lenders for low credit scores in Houston can be found if you are aware of certain tips. In this market, it becomes quite difficult to pick a lender with decent experience. Before applying for a mortgage, it is smart to find a lender who has the caliber to pick out the best loan program. There are many providers available and they do not ask for putting a 20% down payment. Additionally, these professionals are willing to help customers with a not-so-good credit score. But how do you find a reputed lender? Read the tips and make the final decision easily.
- Ask whether Pre-Approval is Available
The experienced lenders always make sure that the borrowers get the pre-approval letter before searching the house. When you are showing this letter, you are considered as a serious buyer. So, the genuine lender for low credit asks for social security numbers, salary information, outstanding debt obligations, and other necessary information. When the lender evaluates your financial status, he can draw a real picture of how much you can borrow. Therefore, you can pick the house within the budge. Hence, the lender is careful about declaring the pre-approval letter to the borrower.
- Go through the Fine Print
Getting a mortgage is already a daunting task to regular borrowers. And reading the mortgage documents is even harder. If you do not read the documents beforehand, you may be stuck with nasty surprises. It is of utmost necessity that you should pay attention to the monthly payment, interest rate, closing cost, and loan processing fee. Generally, the amounts do not drastically change from the period of pre-approval to closing. There are lenders offering credit scores to the borrowers but the credit scores bring high-interest rates. Therefore, you should only choose the lender who is willing to offer FHA and VA against the credit score as low as 500. Additionally, there are no higher interest rates involved either.
- Improve the Credit Score for Better Benefits
Everyone does not qualify for the non-traditional loans – yes, this is true. When your credit score is hanging on the cliff, there is a risk associated with the profile. In order to get the best loan deal from the bona fide expert, you should keep an eye on the credit report. Ask for free copy from the major credit bureaus such as TransUnion, Equifax, and Experian. Reduce the entire level of debt and better the debt-to-income ratio. You can also pay off the recurring bills on time.
When you are in a muddy situation, always ask questions to clear out dilemmas. So, get in touch with the professional as soon as an issue arises!
Author Bio: Joan Gallardo, a Senior Loan Officer, with 20+ years of experience, here writes on 2 questions to ask the best mortgage lender in Houston when you are about to choose one of the first time home buyer programs in Houston.