Credit and Income Factors in Today's "Mortgage Climate"

Posted by Tom Crimmins Realty on Friday, February 21st, 2014 at 11:53am.

By Timmy Rail of Citybrook Corp.  NMLS•: 12812

Passing KeysSome important tips that first-time homebuyers should be aware of as this year's "Spring­ Buying Season" approaches:

  • Your credit profile is made up of 3 scores from the 3 main credit bureaus, Equifax, Experian and TransUnion; lenders will use your middle (average) credit score
  • A huge part of getting "pre-qualified" is to take an early look at your credit scores and credit profile, in-case there are errors or items on your report that you can "clean-up" before you find homes you like and want to put an offer on
  • Lenders generally take your "unreimbursed employee expenses," found on the "Schedule A" of your tax return (generally, page 3, line 21), off the top of your gross income (these may be your job expenses, union dues, etc.); this number may affect "buying power." A proper mortgage "pre-qualification" will review your recent tax returns to ensure this number does not affect a future mortgage application
  • If you are a "commissioned" or self-employed borrower, be aware that lenders generally look for a solid, two-year history of income, with assurances this income is likely to continue into the future. This will also be the case concerning "overtime" and "part­ time" employment.
    • Many "Conventional" mortgage programs require only a 5% down payment and carry cheaper "pmi" rates than FHA loans. Making sure you see all of your mortgage options as a buyer is vital, so you can best decide which mortgage program fits your needs

Getting "pre-qualified" for a mortgage entails a review of all of the above items. Call today for a free mortgage pre-qualification by one of the professionals here at Citybrook

Timothy Rail Citybrook Corp.
(718) 980-7676 ext. 214
(917) 608-8487

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