Ignite FB Tracking Pixel3 Ways Buyers Can Secure the Best Mortgage Terms - Luciana DiGiacomo
Howard Hanna | Rand Realty
Luciana DiGiacomo, Howard Hanna | Rand RealtyPhone: (914) 582-2369
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3 Ways Buyers Can Secure the Best Mortgage Terms

by Luciana DiGiacomo 08/03/2020

Image by StockSnap from Pixabay

The perfect home is not the only thing you'll need to shop for when you want to become a homeowner. In order to get the best terms, the lowest monthly payment and a reasonable interest rate, start doing some homework now -- before you even attend your first open house. 

1. Check Your Credit Score

Checking your credit score should be the first thing you do when you're considering the purchase of a home. Why? Because every lender you speak to will use it as a benchmark for determining the likelihood of you being able to pay off the debt. The better your credit score, the more favorable terms and interest rates a lender might offer you. The earlier you know your credit score, the more time you have to address any issues that might be contained in it. Remember, you're entitled to one free credit report from each of the three reporting agencies each year. Take advantage of this service and keep tabs on your credit score. 

2. Have Steady Employment 

Being able to demonstrate that you are gainfully employed will go a long way toward qualifying for a mortgage loan and being offered attractive interest rates. Aim for at least two years of unbroken employment. Be ready to back up your claims regarding the duration of your employment and the dollar amounts you bring home. 

3. Offer a Sizable Down Payment 

Come to the negotiating table with a lender and with a solid down payment, you'll be able to enjoy lower monthly payments. There's no fast rule regarding the amount of a down payment. That being said, most lenders like you to have at least 20 percent of the home's purchase price as the down payment. There are some lenders, however, who accept less than 20 percent. If your lender accepts down payments that are less than the standard 20 percent, expect to have to purchase private mortgage insurance. This can be anywhere from .05 percent to 1 percent. 

4. Know Your Debt To Income Ratio

The debt to income ratio demonstrates your ability to pay off the mortgage as agreed upon. Most lenders like to see that your monthly debt payments are equal to or less than 43 percent of your gross monthly income. 

In a seller's market, there might be several people vying for the same home. Addressing the items above can make you look more attractive compared to some of the other potential home buyers. 

About the Author
Author

Luciana DiGiacomo

Ready for a change!

Luciana is a licensed Real Estate Agent with Howard Hanna | Rand Realty.  She is licensed in NY and CT and specializes in Westchester and Rockland Counties in NY, Bronx County, NYC and Fairfield County, CT. She is able to help with selling your home, buying a home and any relocation service, throughout the world. She also speaks three languages: English, Italian and Spanish.

Simply put, Luciana is your "go to" realtor. She will go the extra mile and get the job done right!