Get Your Mortgage Fast with These Tips

Buying a home with a mortgage can be a long and painstaking process. On average, it can take 90 days to have the loan approved. Moving may span about 6 months.

Is there a way to speed it up? Yes, by avoiding complications and making your application attractive for approval.

1. Know How Much You Can Pay for Mortgage

Many factors can affect the amount of mortgage one can get. One is the home price. For those planning to live in Maine, for instance, the average home value in the state is $276,000, according to Zillow.

Although the cost has already grown by over 12% over the last year, this is much lower than the national average of $340,000. A mortgage may be more affordable here than in places like Utah, where houses cost as much as $400,000.

Another is the interest rate, which can fluctuate. That can be both a good and a bad thing, depending on when you apply. For instance, last June 2020, the rates fell below 3% primarily due to the rising COVID-19 cases. However, by the early months of 2021, experts saw an upward trend.

To learn more if you can afford to pay the loan, you can use apps like a mortgage calculator. It usually considers not only interest rate and home price but also gross income and existing debts, among others. It can therefore give you a clearer picture of whether you can afford it and how much is the ideal mortgage for you.

2. Improve Your Credit Score and History

Many are obsessed with credit score and history when applying for a mortgage when these are not the only requirements. In fact, you may obtain one even if you have a thin credit history or a low and bad credit score.

However, it remains one of the essential criteria for a lot of lenders. After all, these show your capacity to pay and your behavior toward debt. You may still get disapproved or experience application delays even if you are a conscientious payer. It may happen if they can see you’re settling plenty of huge financial obligations.

Before you apply for a home loan for your dream property, boost your credit score and history stat. Settle first those with large interest or consider paying more than the minimum.

If you have a thin credit history, Experian, one of the three credit bureaus, offers a credit score boost service. Here, you can reflect your on-time payments for utilities such as telecommunications and even Netflix as long as you have at least one active credit account like a personal loan or a credit card.

3. Increase Your Down Payment

Another way to convince a lender to extend you a home loan fast is to increase your down payment. It may not illustrate your capability for repayments, but it lowers the risk of dealing with a large default on the side of the banks.

Some mortgages require less than a 3% down payment, but it may be best to increase yours to 20%, which is the average.

This may even be more advantageous to you as you may no longer have to pay for private mortgage insurance. Also known as PMI, this insurance policy guarantees the lender they can still recoup what they borrowed to you in case you default. You will pay this monthly until your loan-to-value ratio reaches 80%.

4. Work with a Real Estate Broker

Sometimes the reason for the delays and the lengthy mortgage process is paperwork. They require a long list of documents to comply with, but you don’t have the time to accomplish them since you’re busy. You may even forget all about them.

Working with a broker may help resolve that problem. Besides selling you a house, brokers can also guide you throughout the mortgage process:

• They can assist you in prepping the necessary documents.

• They can function as liaisons between you and the seller.

• Brokers can update you on the status of your offer.

• They can orient you on the challenges you may face when applying for your mortgage so you can plan ahead.

• They can offer advice on how to make your mortgage more affordable.

In the end, only the lender can decide if you’re worthy of the mortgage or if you need to modify the details of your application to qualify for one.

However, you can also position yourself well that the bank will have no other option but to give you the loan you need fast. You can do that by showing them you have the means to pay, you are ready to comply with all the requirements, and you have an excellent financial record.