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4 March 2015

Steps to Getting a Mortgage this Spring!

Are you currently renting from a landlord and noticing your rent seems to rise and rise to the point where you’re being squeezed dry? Have you been noticing talk of crazy low interest rates? If you answered yes to these questions it might be time you take a look at becoming a homeowner! Spring 2015 […]

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Are you currently renting from a landlord and noticing your rent seems to rise and rise to the point where you’re being squeezed dry? Have you been noticing talk of crazy low interest rates? If you answered yes to these questions it might be time you take a look at becoming a homeowner! Spring 2015 is the absolute perfect time to take the leap into home ownership because mortgage rates are currently very low. You’ll want to get on this fast though, because they are expected to begin rising higher, later into the year.

The NAR expects 30-year, fixed-rate mortgages to average 3.80 percent in the first quarter. However, mortgage rates are forecast to start inching higher throughout the year. The NAR forecasts an average 4 percent rate in the second quarter, 4.3 percent in the third quarter and 4.7 percent in the fourth quarter.

If this window of opportunity for low interest rates on purchasing a new home appeals to you, we’ve compiled a list of several suggestions for you to get the most out of buying this spring!

Mind your credit score. What’s an ideal credit score?  “To get the best rate, strive for above 740. That is the benchmark for A-plus lending,” says Jeannie Meronk, assistant vice president and mortgage loan officer at First State Bank of Illinois.

Visit your lender before you hit the open houses. Create a game plan that makes sense for your budget. It pays to talk to a lender about what you can afford and qualify for before you fall in love with a home outside your price range.

Don’t make any changes to your financial picture. Once you’ve been pre-approved, this is not the time to open new credit cards, change jobs, transfer large sums of money or make big-ticket purchases using credit.

If you are self-employed, expect to jump through more hoops. Be prepared to provide two years’ worth of tax returns. If your income fluctuated from one year to the next, underwriters will average the income from the two years. Also, underwriters will look at your income after your business deductions have been taken.

Organize your financial paperwork and keep it up to date. If you are shopping for a home, keep a file and drop in new documents as you receive them, including your most recent pay stub and all pages of your bank statement.

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