What are lenders looking for from home buyers in the Fredericksburg, VA area? Mortgage rates nationwide continue to hover near record lows. In the Fredericksburg, Virginia area there is little doubt that the market is continuing to make improvements as home prices recover. Now is certainly a great time to buy. As one thinks about buying and obtaining financing to purchase a home one will want to keep in mind some of the requirements to get a loan. While things are getting better in the local real estate market lending requirements remain fairly strict. So, here are three things lenders are looking at when you come for a home loan.
1. They want to know about your credit score. They want to know about your credit history. While a perfect credit score is not necessary a good credit score is necessary. To get the best rates most lenders will say that you need close to a 720 credit score. To get a decent rate you need a 690-715 score.
2. You have to, depending on the loan, have a down payment. While one may obtain loans with as little as 3% down you may be required to put as much as 20% down. Lenders got burned in years past when homeowners who had no skin in the game simply walked away from houses and left the bank holding the bag. The banks want persons who have some vested interest in making the payment (like not losing the 20% they put down on their house).
3. They are going to look at your debt to income ratio as it pertains particularly to your income and mortgage payment. Most lenders do not like to see more than 36% of your monthly income being used for housing costs.
If you are looking to buy a new home and need some help getting answers about your financing questions then I have access to qualified mortgage professionals who can answer all your questions. Give me a call or text me today!