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Our home planning centers: 

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getting yourself qualified

what lenders like to see

There are four key areas that lender review in order to qualify you for a mortgage. These 4 items include:

  1. Favorable Appraisal:
    the home that you are seeking to buy (or an existing home under refinance) must have an appraised value that is 20% or more greater than the loan amount being requested; i.e., the 80/20 rule.

    Some lenders will extend loan amounts greater than 80% LTV of the home, but those financing amounts usually require PMI and will carry higher interest rates.

    supporting information

    • home valuations
      request a neighborhood and home assessment report on the property under consideration

    • LTV calcuation
      use this calculation to determine how much loan amount you can get
  2. Good Credit:
    lenders will review your credit report and score. Applicants with high credit ratings are more likely to be approved with lower mortgage rates.

    supporting information

    • about your credit report
      view what's in your credit report and how to fix it up prior to submitting your application

    • check your FICO score
      lender use the FICO score to determine qualifications. The higher your FICO score, the better your approval rate
  3. Maintain Good Housing and Debt Ratios:
    your housing ratio should be at 28% or lower; and your debt ratio should be at 36% or lower. These ratios measure the percentage of debt against your income. Applicants with high housing and/or debt ratios are less likely to be qualified for a loan.

    supporting information

  4. Have Steady Income:
    lenders like to see applicants that are in jobs with steady income. If you are self-employed, you will need to demonstrate a history of income that is coming in.

    supporting information

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