We talk to hundreds of First-Time Home Buyers year after year and there are hundreds that don’t qualify by just a bit. They are so close but can’t get it done. We explain to them how close they are and offer direct advice on how just a month or two of fixing their issues will get them where they want.
So if you are just dipping your feet in the water and thinking about buying in the near future, let us help you prepare now to never have to feel the sting of denial.
We know a lot of you work jobs where you get tips, or you are just now getting raises, or are new on the job. If you are in any type of training period you will not be able to get a mortgage, but don’t worry as soon are that’s done, you are qualified. If you have gotten tips and never claimed much of them, it is essential that you spend 6 months claiming even more than you are actually earning. Even though it will mean less money in your pocket during this time, it will do wonders to raise the 2-year average of your income and increase your ability to qualify.
If you don’t have any, get some immediately. We know you may think that not having any debt may be good, but you are wrong. The bank needs something to judge you on and credit cards are essential. They show your ability to repay a mortgage while not adding a lot of monthly payments to your debt ratio. If you have a boyfriend/girlfriend, mom/dad, sister/brother that are willing to add you on their current credit card accounts do so immediately. Try to get one on your own too. This is the type of thing that if your score is slightly low just a month of obtaining credit can make the difference of qualifying or not.
If you are on the edge of qualifying or not, the best thing you can do is to add any type of factors that can compensate for the areas you lack. If you pay rent in cash, get a checking account and start writing checks. Showing 6 rent payments made on time will do wonders at improving your qualifications, but cash just doesn’t count. Money orders may work if you pay to an apartment complex, but if you are renting a house, only checks will do it.
Start saving money. People always feel like it does not count, but even $500 will definitely increase your chances of qualifying.