Qualified Buyers

How to determine if I'm a well qualified buyer?
 
The majority of homebuyers don’t know the right steps on how to become pre-qualified for a mortgage loan. That being said, it is important to ask the right questions when searching for a mortgage broker to assist you in obtaining a "pre-approval". Knowing whether or not you went through the process correctly will save you time on the home shopping experience, as well as a peace of mind knowing you are well qualified.
 
Steps a mortgage loan officer takes to determine your qualifications: 

  1. Review the credit report? – The credit report shows all revolving credit obligations, delinquencies, and derogatory accounts.
     
  2. Review the employment history and income? – W2s line up a borrower’s employment history and the pay stubs will give an exact number to use for monthly income. However, there will be times when a borrower is self-employed, which takes a detailed analysis on their tax returns. Self-employed borrowers are qualified based on their net income over the last 2 years, and sometimes have income that can be added back in after reviewing the tax returns.
     
  3. Verify the assets? – Seeing the bank statements will show proof of funds to close on the transaction. More importantly, we want to make sure the borrower does not have any large cash deposits that we cannot use.