Getting a mortgage - where do I start?

Please can anyone point me in the right direction? I would love to buy a house but don't know where to start. I am getting an inheritance soon, around 20k so want to use this as a deposit. Trouble being, I am in a job which I hate - on about 17k a year but my boyfriend is unemployed at present.

I am thinking of changing jobs too (self employed but with an on-going contract with someone)... is it really silly to even think about a mortgage now? It's just that house prices seem to have come down a lot recently - also, I think I could end up buying a 3 bed house and end up paying less per month than what I pay renting a 2 bed.

Any help or advice would be greatly appreciated. Thanks

4 Answers

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  • 9 years ago
    Best answer

    Buying a house is a step by step process, this is the first step you should take in order to purchase a house. The rest of the steps will fall in place, no matter the type of property you are purchasing.

    In order to find out the type of loan programs you are qualified for you will have to fill out a loan application, with a mortgage broker, which you can find one in your local telephone book.

    Make sure this mortgage broker or mortgage banker is able to do government loans such as FHA and VA loans if you qualify for one. With a VA mortgage loan you are not required to have a down payment, this will save you on closing cost.

    He will fill out this application, which takes awhile so grab your favorite beverage and sit down. Once you have completed the application, he will run your credit report which will have your credit scores. These credit scores will determine your interest rate.

    The amount of your monthly debt payments you are required to pay as per your credit report and the amount of mortgage you can take on based on your income will determine the amount of house you will be able to purchase.

    When you speak with the mortgage broker you will need the following documents to complete the loan application, there will be others, but this will get you started.

    #1 One month of pay stubs for each person that will be on the mortgage.

    #2 Six months bank statements from each bank in which you bank as well as statements from any 401K from you place of employment.

    #3 Two years of federal income tax along with the W-2 that match.

    Once he has all that he need to do he can then issue you a pre-approval letter so you can purchase a home. In this pre-approval letter will be the amount of house you are qualified to purchased.

    Once he gives you this pre-approval you may now find a real estate agent to find yourself a home or he might have a referral.

    Now make sure before you get your pre-approval you and your mortgage broker go over all your options as to the mortgage programs you qualify for, the interest rate, monthly payments.

    If you are getting a FHA, fixed rate, two loans to eliminate PMI like an 80/20 or one loan, if you are qualified for and approved for a 100% loan.

    You should select the loan that best suit your financial condition at the time. That could be an adjustable rate loan. It could be a fixed rate loan for 5 or 10 years and then adjust. Some adjustable rate mortgages only adjust once.

    Make sure your mortgage broker explain all your options so you may make an intelligent decision.

    What might be good for one person might not be good for you, in other words just because your friends and all your real estate buddies are telling you about the great fixed rate they got, your financial situation might call for something else.

    So select the best option for you and your financial situation.

    You should also get a Good Faith Estimate (GFE) which will indicate the cost you will have to pay for getting this loan. It will also indicate the amount of your down payment.

    Once you have found a home the real estate agent will then prepare a contract for you and the seller to sign.

    Your mortgage broker will now order an appraisal to show proof of the property value.

    The mortgage broker might ask for additional information or documentation, don't get all up tight this is normal, just supply the information or find the documents needed.

    After the appraisal has been completed you will be called by your mortgage broker to sign your loan docs so you can take possession of your new home.

    Before signing any loan docs make sure they say exactly what you and your mortgage broker went over when you decided on what mortgage program was best for you.

    I hope this has been of some benefit to you, good luck

    "FIGHT ON"

  • 9 years ago

    For now invest the money, start an online investment account with fidelity or any other, I say fidelity cause I have them and can speak first hand about the account. Health care is the sector you want the largest chunk, since the growth is great and baby boomers increased needs a stable area. General electric, Phillips, for durables, J&J on consumables, united health care, Metlife, and pick a strong pharmaceutical company. Make that a five or ten year plan while you improve job skills and education. 20K is a good start on retirement plan too so don't be so quick to offer it up to the bank where it does you nothing, while in you account it can be used as a plus on your ability to demand a lower car loan rate. Hold on and build that money.

  • 9 years ago

    Today, visit your bookstore and get two books

    1. Mortgages for Dummies

    2. Buying Your First Home for dummies

    (not trying to insult you - these are fantastic books)

    Home prices are not going anywhere for a very long time.

    And interest rates are not going to be going higher any time soon.

    ^^^ Suze Ormond - last nights show on CNBC

    So hold off and wait. Get stable jobs. And get married before you buy your home

    And build up a savings on top of that 20% down payment.

    And work on your credit reports and making sure they are both in top shape.

    Print them out at Annual Credit Report.com

    No cost - no debit card required

  • ?
    Lv 6
    9 years ago

    Yes, it IS silly to consider that until your employment situation is stabilized. $17K a year will not qualify you for much of a loan. Home prices are not going to shoot up anytime soon. Put the money safely in the bank and go buy a copy of "Home Buying For Dummies" (an excellent book).

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