Will you buy a home and make mortgage as financing ? Then start tying all the paperwork together! And do not forget to bring your favorite pen when you sign the contract. In every financial transaction there is a ritual: Search, buy, qualify, and sign the loan agreement, financing or mortgage of property. All of this can be very confusing and exhausting, especially for the time of going back and forth to complete the whole process.
Making a mortgage to purchase property is not to be afraid of, but of course the new owner must and must be prepared to make that decision to take a step forward to conquer at the end of the walk your precious home. Whether it’s buying your own house, apartment, site or a piece of land or rural property to build after the way you’ve always dreamed. Well, let’s go to the basic steps that must be observed before starting to apply for your mortgage to buy property.
1. Clean up your credit report at Serasa
Get copies of your credit report and see if there is any negative debt or membership that needs to be cleared from your history. Being with the name dirty, that is, with restrictions, however small it may delay or prevent the release of credit for a mortgage and also other types of credit. So, try to correct these debts before making the request to the lender.
2. Gather all necessary documentation
Before you try to qualify with a mortgage loan simulation, your potential lender (credit institution) will require a lot of information about you, including:
- All information about your bank, name, address to your account numbers and statements
- Put together all the income statements from the last six months, it’s better!
- Get your proof of employment and last month’s pay stubs
- Present your tax returns as pro-labor and IRPF income tax if self-employed
- Authorizations for lender to verify your income, bank accounts and credit in general
3. Prequalification … or pre-approval of credit
A pre-qualification is the lender’s determination on the amount of the amount of a mortgage that you can qualify based on your “default index.” For example, your ratio of monthly housing expenses to your gross monthly income, it should not exceed 30% in theory.
Pre-approval is the amount a lender commits based on your income and credit through a checkout. It also gives the buyer more credibility and can differentiate it from other potential buyers.
4. Information on costs, fees and interest
After applying to receive a loan, financing or mortgage, the lender must provide:
- Information on all effective interest rates and mortgage costs
- Inform consumers about mortgages the types of mortgage rates
- Inform the “CET”, a full and detailed cost estimate for closing
5. The assessment of the creditor
The property presented or your home will serve as collateral for the mortgage of the property therefore the lender will request a valuation of the property’s market value. In addition, if it is necessary to fit the rules for applying the mortgage according to the credit policies of each bank – the terms are different between the institutions, always know what the terms and rules are.
6. Mortgage Approval
When mortgaging, lenders will do all the necessary checks, from personal documents, addresses, directions, your employment and bank accounts so that the approval process is completed. In most cases they will also make the evaluation of your credit report, score and consultations with SPC and Serasa etc.
Congratulations to you who are ready to apply for a home mortgage, just be sure to pay for the rest of your life, the contracts are long, very long. Good luck!