Whether you need to move out of a rental property in a hurry, can see the market rapidly rising, have found the home of your dreams, or otherwise need to buy a place quickly, you’ll likely need finance on your side.
Most people need a mortgage to purchase a property, regardless of where they might want to live or the type of house they’re after. If you have time constraints, look for ways to streamline the mortgage approval process and avoid unexpected holdups.
Check Your Credit Score
Check your credit score before you put in your loan application. You might have done all the right things, but if there was an error at some point, your rating might be lower than it should be. If so, get the issue fixed up so it doesn’t cause unnecessary results when lenders check into your history. Also, you might find out that there’s an unpaid account or some other factor that you completely forgot about that you could get sorted to give yourself the best chance of having your loan approved ASAP. You can’t rectify such problems if you don’t know they’re there.
Sort Out Paperwork
Anytime you put in to get a loan, you have to submit quite a lot of paperwork to financial institutions. If you want to get a mortgage happening quickly, sort out all your documentation before applying, so there’s no holdup while the banks wait to get the forms they need.
Spend time preparing things such as your personal tax returns from the last three to five years and, if needed, your business tax returns and profit and loss and balance sheet reports. If you work for someone else, you’ll need to supply multiple weeks’ worth of payslips. Plus, lenders usually want to see details of any personal loans you have, or student loans, credit card statements, and bank account statements.
If you already know the property you want to purchase, compile all the details related to it before approaching a financial institution. They’ll want to see information such as the price of the home, its current valuation, and rental potential (if you plan to rent the abode). They may want data about renovation work or repairs that part of the mortgage might go towards paying, too.
Research Lenders And Terms
Another way to give yourself the best chance of having a loan approved is to submit an application for a mortgage at suitable places. Different lenders have different terms and conditions and rate offers. They may not all be the best fit for your particular needs. Research lenders and the fine print on their loans, so you don’t waste time applying for loans with no chance of approval.
Look into financial providers in your general areas by searching online for “mortgage, Virginia Beach,” or “home loan rates in San Francisco,” etc. It pays to read blogs and forums and ask friends and family members for suggestions of potential lenders to approach, too. Plus, don’t forget that these days there are plenty of alternative options to the big banks. The non-traditional lending category has grown substantially in the last decade, and many of these organizations advertise that they often approve loans in mere hours or days.
Pay Down Debt
If you want to boost your chances of having your home loan approved right away, reduce the amount of debt you have. Pay down credit card balances, student, car, and personal loans, tax debt, and the like to improve your credit score and give you a more favorable debt-to-equity ratio. The less you have to pay back to other creditors; the more cash lenders will believe you can pay off from a home loan, and thus the more comfortable they’ll be approving your application.
Note, too, that it’s best to avoid taking on any new debt while you’re applying for loans and waiting for responses. Adding extra expenses to your credit card or getting a small loan for something might not seem like a big issue, but increasing your debt levels could make a difference between whether you get a yes or no.
Other tips for a quick turnaround time for a loan application include not making big changes to lifestyle factors, such as quitting your job. Also, ensure the purchase price listed for a home will seem fair to bank valuers. If it appears you’re going to pay over market value, you might have a problem. Another idea is to put in a larger deposit, so you don’t need to get as big a loan.
Every step you take to make yourself seem a better risk to a financial institution will help you get your loan more quickly and minimize your stress, too.