Your mortgage advisor will need to have as much financial information about you as possible and will ask you a number of questions. These will mainly be centered on your income and employment.
They will ask you about how much you earn, how long you have worked at your present job and whether your income is steady or irregular. If you do not have a steady income they will certainly need to have more details about your earnings in order to be able to offer you a good interest rate.
The best response is that you have been in regular employment for a minimum of two years at the same job or at least in the same type of work. It will work against you if you are a self-employed or contract worker and that your earnings are irregular
The other main area of enquiry will be about your debts, whether you have any and how much all your monthly repayments on loans and credit cards. They will also need to know what percentage of your gross income goes on monthly repayments on any existing debts. You will have little problem if you can show that you have a low level of debt and that you are paying no more than 36% of your total income on existing debt repayments. You will also need to show that you have not recently taken out any major commitments such as an auto loan. Any evidence of a high level of debt or mixed-out credit cards will certainly work against you
You will need to have sufficient funds in the bank to cover your deposit and closing costs so they will ask you details as to the present state of your bank account. Then they will want to know the financial source of your deposit money - for example they will ask if it is a parental gift or perhaps a non-profit grant. The main thing here is that you have sufficient funds to pay a deposit of at least 5% of the sales price.
It will work in your favor if, after closing, you have enough money left for at least two mortgage repayments. They will not be impressed if there is to be no remaining funds after closing costs or if you are paying the deposit with borrowed money or at less than 3% of the purchase price.
You will need to tell them if the loan is to be for purchasing a property or refinancing. If it is the former, what type of property you are planning to buy, whether you intend to live in the house or if it is for investment. If you are buying a detached single family home and plan to live in it, this will certainly work in your favor but they will not look on your application favorably if it can be seen that you are just looking to purchase a holiday home. If you want to refinance they will ask you how much cash if any you will need at closing for paying off other debts.
The bottom line is for your mortgage application to be successful you will need to show evidence of regular earnings and a solid financial status and that just paying the deposit or making the initial repayments will not leave you struggling to meet a new financial commitment.
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Gus Taperman holds a Bachelor's degree in Commerce and completed his master's in Business Administration . He is working as writer and financial consultant to find a Personal loans, Debt consolidation, home equity loans at cheap rates visit www.taperman.com