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| Home
> For Buyers
> The lending process |
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1. Choose
a lender and prequalify for a loan
2. Mortgage
calculator
3. The
loan process in 8 steps
4. Loan
Documents checklist
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It is recommend
to establish a working relationship with a lender early
in the process, and getting pre-qualified prior to looking
for a home. I can assist you in locating lenders. A Lender
pre-qualifies you by determining what loan programs may
be available to you, and suggests programs that meet your
short and long term plans. You will also find out what
your monthly payments and down payment will be. A letter
of pre-qualification (or pre-approval) from a lender
enhances your position in the eyes of the seller.
In general, lenders allow your total monthly housing costs
to go as high as, but not more than, 30 percent of your
gross monthly income. The second requirement is that not
more than 36 percent of your gross monthly income can
be tied up in total monthly house payment and payments
on outstanding long term debt.
Lenders use slightly different formulas for arriving at
"total monthly house payment". These costs generally
include your mortgage principal and interest payment,
property taxes as a monthly figure, and hazard insurance
as a monthly figure. These four items are referred to
as PITI (principal, interest, taxes & insurance ).
If you're required to pay private mortgage insurance (PMI)
because your down payment is less than 20%, those premium
payments will also be included. If you decide to buy a
condominium or town house, the monthly homeowner's association
fees will be included. Keep in mind, these formulas aren't
cut and dry and things change from lender to lender, so
your best bet is to consult.
Click
here to calculate how much you house you can afford
Get Your Financing in Order
You can get together with a lender to get your loan application,
completed and the financing process started. Be prepared
to provide the lender with copies of any important and
necessary information.
click here for a checklist
of the documentation your mortgage broker might need from
you
Next: the loan process in 8 steps.
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