Millennial Mortgage Tips

It is not a rule or a law that millennials won’t be able to buy a home for themselves. The reality is that for the fifth year in a row, millennial homebuyers have surpassed Gen X and the babyboomers in this department! So for those looking to make this big decision, well, it is possible! You just have to ensure that you do it in the right way.

1. Search for a Trustworthy Lender:

   A Reliable lender is a must for anyone, and seriously very important for those seeking to buy a home for the first time. He will inform and advise you on all the available mortgage options, and will also move the process smoothly for you.

2. Credit score:

   The most important factor to be approved for getting a mortgage. Check how much it is and improve it as much as you can. If you have any debts to pay or any pending disputes, get the work done and achieve your best credit score. Ensure that under no circumstances your credit score gets lowered again at this time period.

3. No playing around with cash:

   Cash doesn’t have a paper trail and hence it is difficult for lenders to source. Don’t deposit cash or move money from one account to another as much. It can cause issues in the future and even lenders will ask you on that.

4. Pay off your student loans:

   College debt is a real big challenge for millennial students. If you still have it, clear this on a priority basis. You should know that Lenders calculate your debt-to-income (DTI) ratio and determine your loan eligibility. Besides the student loans, if there is any other debt you have incurred like the consumer debt, clear that too!

5. Search for an affordable house:

   The cheaper it is, the easier it will be for you to pay your debt. Having said that, don’t compromise on your choice, type, or quality of home. If you badly fall in love with a home, go for it. But the rising market prices of homes, in general, can be very annoying, which is why an affordable house in a seller’s market will be good for you.

6. Comprehend the different down payment options:

   Know that all mortgages don’t require a twenty percent down payment, hence study all your options. This will be helpful if you are unable to cough up the money for a 20 percent down payment. The FHA home loan has a 3.5% down payment option and is a good option for first-time homebuyers. On the other hand, no down payment is required for a VA mortgage!

7. Get a pre-approval:

   You will know your buying power when you start with this first step for a mortgage. The lender will review all your financial documents and you both can then infer the kind of homes you can afford. Also, be ready to provide more documents if they ask; it will all depend on your personal situation and loan type.

Once the mortgage process starts and you have your finances in order, you will enjoy the path to get complete homeownership to yourself and turn your American dream into reality. It is essential for every family to have a home of their own, as Home is where the Heart is!

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