How should I prepare to get a loan

The first thing to do, even before shopping around for a loan, is to determine what the greatest monthly payment you can make.

It's also a good idea to have pre-determined financial goals. Possibly, a lower interest rate, debt consolidation or cash out.

Checking your credit and credit report and knowing what is on it will help you prepare to get a home loan, also known as a mortgage loan. You should check your credit report at least once annually regardless of whether you are applying for a home loan or not. This way you can ensure the accuracy of the material that is contained within the report, check for discrepancies, make sure that everything being reported on your report is indeed yours, and you can check many other things as well. You are now entitled to one free credit report each year so that you can keep updated on your credit profile. Any inaccuracies that you find on your credit report, you should dispute with each credit bureau so that the items can be removed or properly reported. This can take up to a few months to take care of, so it is highly recommended that you check your credit report at least a few months in advance of getting ready to apply for a mortgage.

Its not a bad time to be deciding who you want as your real estate agent. Ask family and friends their opinions on a good Realtor in your area. A Realtor will discuss area neighborhoods and pricing trends so you can make the most informed decision.

This is the time to find a mortgage professional who will help you get a mortgage. A loan officer will be able to answer any questions that you have, and will be able to prepare you for what to expect. In addition, they will be able to provide you some referrals for real estate agents who might be a good fit for you.

Have you thought about which loan program is right for you? If you choose to make little or no down payment then look into 100% financing. Considering a 30 year fixed rate mortgage? An adjustable rate mortgage may be a wiser choice if you have troubled credit or only plan to be in you house a few years. Need the absolute lowest possible payment? A pay option ARM could be the solution.

If you've had a BK in the last seven years, it may be a good idea to dig through your paperwork and have your BK paperwork ready. While not always required, most lenders will require your discharge paperwork to get your approval and having them ready will not delay the approval process.

If you are currently in a BK, start talking with your Trustee to see if there is any type of forms or approvals that must be obtained before you can apply for a refinance or a new purchase.

Because it can take time to correct any mistakes on your credit report, it is prudent to examine your own credit history ahead of time. Such simple step can potential save thousand of dollars in the long run.

Start asking around for referrals. Talk to people you know who have just recently bought their home or refinanced. Check out several mortgage companies and make sure they are reputable before you apply.

In order to save yourself time and headache, it is a good idea to gather at least one month worth of paystubs, 2 years of W-2s, statements for any accounts you plan to list on the application such as savings accounts, checking accounts, retirement accounts, stocks and bonds, etc... Also, familiarize yourself with your credit report so you know not only what your score is, but how many accounts you have in good standing, whether or not you have accounts that are in collection, if you have any mortgage lates etc... If you come prepared with these documents not only will you make a brokers day, but you will also find the entire process to be much smoother than if you have to play a cat and mouse game with the broker and lender who will inevitably need all of these documents.

If time is a factor and you need to close quickly, ask us about a NO DOC or no documentation loan (also called NINA or NI/NA/NE), which can allow you to close your loan in as little as a week by cutting out most of the heavy documentation.

A home loan can be one of the largest financial transactions you will make. Make sure you use a mortgage broker who can help find a loan for you. Have your financial goals and records available. Communicate to the mortgage broker your future plans and obligations.

Think about what you will do for a down payment. You may have saved and are prepared to make a down payment. You may have others willing to give them money to use for a down payment. Or, you pay consider going with 100% financing, making no down payment at all.

Be sure to discuss different options with your loan officer. Even if you have saved up, anticipating a down payment, it may be wise to use the money differently. A mortgage professional will guide you as to how best allocate what money you have at the beginning of the process.

» DISCLAIMER: The information contained in this article on 'How should I prepare to get a loan' is a collection of contributions by licensed mortgage professionals and is not the opinion of Broker Outpost LLC. Always consult a licensed professional before applying for a mortgage.