Tips for Mortgages

FinanceMortgage & Debt

  • Author Laura Ginn
  • Published November 27, 2013
  • Word count 637

Signing up for a mortgage is a necessity for many people who wish to own their own home. There aren't many people who can afford to spend several hundred thousand pounds for the home of their dreams at one time. Mortgages allow people to borrow money from a lending organization like a bank to finance the home they've always wanted. They will typically have anywhere between 15 and 30 years to pay back the money, plus interest. When signing up for a mortgage, it is important to not accept the first offer you find. Shopping around is one of the keys to getting the best rates to finance not just your home but the future of your family.

When you get ready to apply for a mortgage, the first step to take is to research your existing credit history. Look up both your credit report and your credit score to get an idea of how much you can expect to pay in interest should you be approved for a mortgage. Because of the housing crisis of the late 2000s, credit standards for new mortgage applicants remain very tight. New mortgage rules have been unveiled as recently as 2013 and are not expected to loosen in the near future. As a result, your credit history has become your most valuable asset with regards to securing a home mortgage. If you want to get the best rate on a mortgage, you need to have a credit score of at least 720. Though it is still possible to get decent rates with a score of around 680, interest rates will gradually start to increase as your score drops lower.

If you know you won't be applying for a mortgage for a few years, start taking steps to repair your credit today. Pay down as much debt as you can and get your finances under control. If you have any past accounts that have gone into collections status, pay down those debts so they can stop hurting your credit score. Though repairing a person's credit score takes a long time, getting on financially stable ground today will definitely pay off when it comes time to borrow money for a house. Every little step of progress helps when it comes to getting the best rates on a mortgage.

If you already have a home mortgage, consider refinancing to lock yourself into more favorable rates. Due to the housing crisis of the last few years, home rates all over the world remain at an all time low. If you purchased your house several years ago and are current on your payments, refinancing can be a great way to lower your monthly minimum payment, your interest rate or both.

Once you've applied for a mortgage and have been approved, remember one key piece of advice: the process is not officially over until the loan "closes." When you've been approved and your home offer has been accepted, you will need to provide a large number of documents to the bank. Most mortgage brokers require these documents to be in hand as quickly as 24 hours after the process begins. Do not delay in getting these documents to the right people, as missing your deadline could see the whole process fall apart before your eyes.

If your mortgage is "underwater," consider refinancing. Underwater mortgages are ones where a customer owes more money on the house than the property is actually worth. When the economy all over the world was in better condition a few years ago, these people had a difficult time refinancing and getting more favorable terms and conditions. Because the market is in its present condition, these people are finding it much easier to get the results they want. Even if you've tried to refinance in the past, now is the time to try again and hope for the best.

Kevin Campbell knows that when you have a less than perfect credit rating it can be difficult to get a mortgage. Go to and find out about mortgages especially for people with a bad credit history and see if they could be something of interest to you.

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