6 Tips for Getting Your First Mortgage

Posted by Robbie Johal on Wednesday, August 27th, 2014 at 2:30pm.

Whether you are looking for a new home in Clayton, Surrey or anywhere in Canada, the rules for getting the best mortgage possible is the same. A mortgage is often the largest and longest financial arrangement most families make, so you deserve to find the best mortgage for you and your family. There is a lot that you can do to get you there, so here are six tips that will help getting the right mortgage easier.

1. Budget: Get a Solid Plan.

In order for you to know what you can afford, you need to know where your money is going. Once you know that, you can figure out what you can save and how much money you have for repayments. There are tons of great mortgage calculators out there, but you can also have a conversation with a mortgage professional about where you are and what kind of home you can afford.

Additionally, at the same time that you start planning your budget, gather your credit score and go through it. If there are corrections to be made, you’ll have time to get them cleared up with the bureau before you apply for a mortgage. Credit blemishes, like debt, can have an effect on the mortgage options that a lender may offer you.

2. Get Rid of Debt (as much as you can).

When applying for a mortgage, debt is a huge concern for a lender. Debts are seen as a test of your creditworthiness. If you have too much of it, you’re not worthy. Demonstrate that if you do have debt that you’re managing it well by paying it down—or paying it off completely. Paying your debt down can also show that you can borrow more money than someone who isn’t capable, meaning you may be eligible for more options.

3. Saving Will Save You!

The bigger your down payment is, the better off you will be—in the short term and the long term. Larger down payments allow lenders to offer you a wider variety of options, and they tend to save their best rates for customers with more cash in hand. You will also be able to lower your payments, so save as much as you can.

4. Job Stability and Security: Stick Around.

You might be ready for a big move to a new company or team, but if you choose to do this right before you apply for a mortgage, it could influence your options. It might be best to let the ink dry on your mortgage before you make any jumps. Some lenders suggest at least a half year for your current job.

5. Prove Your Intake: Income

Just like your creditworthiness and debt matter to lenders, so does your income. Some lenders ask for six months of bank statements to review your income and spending, so keep your year-end statements and tax returns.

Things get tougher for small businesses, as most lenders will need to see several years of accounts. Some may go back as far as three years, so it pays to keep good books. Lenders take a stronger position with small businesses, so it’s best to be prepared.

6. Be Willing to Seek Professional Help

A lot of people like to go it alone when diving into new areas, but mortgage and real estate professionals can help you through all aspects of the buying process, from planning to saving to pre-approvals to shopping to close, pros work from their on-hand experience to help you avoid any pitfalls. We can give you the confidence you need to get your first mortgage, and we have the experience to know the right direction. We make it our job to work with you so you can achieve what you dream.

If you have any questions about how a real estate or mortgage professional can help you, give us a call or get in touch with us.

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