9 Tips to Get You Approved for Home Loans in Vancouver, WA
So, you are looking to buy a home but need to get past that first step – getting a home loan in Vancouver, WA.
It can be hard to understand all of the lingo and ins-and-outs of the process of getting a home loan.
Let us simplify the process by describing some easy steps that you can take to get your mortgage pinned down.
1. Get your Credit Score and Report
Your FICO score is the most important part of getting a home loan, so seeing your credit score is the first place you should start.
You can get your credit report online for free at a few different websites.
Usually, a 620 credit score is roughly what is needed to get a home loan.
Common mortgage credit score requirements:
- VA Loans – 620
- USDA – 640
- Conventional 97 – 640
- 203k – 640
- HomePath – 640
- Conventional – 620
- WA Bond – 620
- Jumbo – 700
- FHA – 580
Call us here in Vancouver, WA at 360-524-2587 and we will be happy to help you find your credit score
2. Find Errors on Your Credit Report
Errors on your credit report aren’t usually a small issue. A study conducted by the FTC concluded that 1/5 of consumers have at least one error on their credit report.
If you find an error on your report, dispute it with the three major credit bureaus. Here are the numbers for the three credit bureaus:
- TransUnion: 800-916-8800
- Experian: 888-397-3742
- Equifax: 888-548-7878
You can also file disputes online at:
- TransUnion: https://www.transunion.com/credit-disputes/disputes-new
- Experian: https://www.experian.com/disputes/main.html
- Equifax: https://www.equifax.com/personal/credit-report-services/credit-dispute/
3. Improve Your Score Before You Apply
It sounds silly to say, but the difference between getting a loan and not can be as little as a few points in your credit score. A better credit score also (typically) means a better interest rate, so it’s wise to always be working to better your credit score.
Here are some things that you can do on your own to get a home loan with a better rate before you speak to a lender.
- Pay down the balance on your credit cards
- Don’t apply for new credit cards or loans
- Make all payments on time
4. Get Pre-Approved
Pre-approval for a home loan is the first ostensible step toward getting your home loan. Steps 1-3 are just about making sure your credit is fit enough to bear a loan.
Call us here in Vancouver, WA at 360-524-2587 and we will get you on your way toward pre-approval in no time!
Documents you will need for pre-approval:
- Credit report and scores (we can help with that)
- Tax returns from the past 2 years
- W2’s from the past 2 years
- Paystubs for the last month
Remember: pre-qualified is not pre-approved.
5. Check Your Savings
You will need to make sure that you have a certain amount of money to buy a house. You will probably need to cover the closing cost and the down payment.
Here is the minimum down payments needed by each mortgage type:
- VA – No down payment
- WA Bond – No down payment
- USDA – No down payment
- 203k – 3.5%
- HomePath – 5%
- Conventional – 3% and up
- Jumbo – 15% – 20%
6. Check Your Budget
The maximum loan amount that you qualify for is determined by your debt-to-income ratio. The debt-to-income ratio is calculated by taking your monthly debt payments and dividing it by your gross monthly income.
7. Do You Qualify for Down Payment Assistance?
This is where we at The Domench Team in Vancouver, WA can help you out big time! Determining what kind of assistance you qualify for, whether it be a first time home buyer grant or some other similar program, can help to relieve the burden of a down payment.
8. Learn About the Types of Home Loans
There are quite a few different kinds of mortgage programs to choose from. Many of them you will not qualify for because of their narrow scope.
At The Domench Team in Vancouver, WA, we can help to narrow down the loans that you qualify for and we can advise you on which loan will best fit your scenario.
Different Loan Types:
- Conventional Loan
- FHA Loan
- USDA Loan
- VA Loan
- Renovation Loan
9. Choose the Loan Term
There are two different loan terms for mortgages, adjustable-rate and fixed-rate.
Fixed-Rate Mortgages – this means that the interest rate does not change for the duration of the loan. The most common terms for fixed-rate loans are 30-years and 15-years.
Adjustable-Rate Mortgage – These loans have a low initial rate that fluctuates after a certain period.