WHAT TO KNOW BEFORE YOU APPLY FOR A HOME LOAN

Pre-Qualified: This term is used when you are first inquiring about obtaining a home loan. Being pre-qualified does not approve you for a home loan. Lenders will take a basic and quick look at your financial situation and decide if you are eligible to actually be approved for an official home loan. This process is fairly quick and doesn’t require you to provide your social security number or drivers license information, nor does it require you to provide actual account statements or other in-depth personal information. But remember, being pre-qualified does not approve you for a home loan. Once you feel comfortable with loan prequalification, you can then ask a licensed loan officer to review your legal documents and personal information to move to the pre-approval process.

Pre-Approved: After your preferred mortgage officer runs your credit, reviews your financial situation, and confirms that your provided financial data is in good standing, they will grant you a pre-approved status at the amount requested to be borrowed. This status normally will be paired with an official pre-approval letter that you will present to your real estate agent which will help speed up the process of purchasing a home. Being pre-approved for a loan is an important step in buying a home, so you will want to make sure you contact your best local loan company for assistance.

Loan Commitment: Loan Commitment is normally confused with pre-approval because they are very similar in definition. This is the most important step in acquiring a home loan because it gives you the actual commitment stating the exact terms and interest rate details that the pre-approved loan amount is maxed at. You can look at ‘loan commitment’ as a detailed explanation of what your pre-approval confirmation includes. It is important that you understand the terms before signing off on the loan being offered by the qualifying mortgage company you are working with.

TYPES OF LOANS

Conventional Loans: Conventional home loans can be used for single-person applications even if you are married. This type of loan allows you to keep your significant other’s finances out of the home loan application process which could be of benefit if your partner has poor credit. Conventional home loans do require a higher credit score for approved home buyers. When making a down payment, it is always recommended to have 20 percent down, but some situations can allow you to provide a down payment as low as 5%.

FHA Loans: Are you considering an FHA loan? These loans do allow you to buy a home with less down versus a standard home loans, but you need to get all the facts available about FHA loans for your area and find out if your debt-to-income ratio allows you to qualify for an FHA loan.

VA Loans: VA Loans are perfect for Military households, both active and veterans. Have you served in the United States Armed Forces? San Antonio is home to many military veterans, and these strong individuals might qualify for a VA home loan. This program is great for military families and individuals, so be sure to consider a VA loan when applying for your next home loan.

USDA Loans: USDA Loans offer great benefits for individuals looking to move to a rural area where the home has been approved as part of a USDA eligible location program. USDA loans offer grant assistance, but you must first apply for this assistance, and, if approved, you may be eligible under the Satellite Grant Program. Household income must meet certain standards, and your area of interest must be under the USDA rural areas eligible for a USDA loan. For more information contact our preferred lenders.

RELOCATING TO SAN ANTONIO? CLICK HERE FOR SAN ANTONIO RELOCATION INFO! Kristen is a proud member of the KW.com Team