3 Questions A Loan Service Will Need Answered Before Offering A Mortgage
Buying your first home is a little intimidating. A lot of newbie buyers wrongly assume that obtaining a loan with good credit and a reliable income is fairly easy. However, it is oftentimes harder to find a home that a lender will be willing to offer a mortgage loan to pay for. Before a first-time home buyer loans service will extend you a mortgage loan offer, there are certain things that they will be asking about the house you want to buy. When you understand what a lender is going to be looking for in a home that is a good candidate, it can help you narrow down your choices as you shop around.
Will the house stand good for the value of the loan you need?
This is the number one thing a lender will want to know about a house. The property must be valuable enough that the loan would be covered if the lender had to repossess and sell the property to cover the money loaned to you. Most lenders will require thorough home inspections before they will approve a loan on a specific property. This inspection will make sure the property is structurally sound, free of major defects, and worth the asking price.
Is the property value at risk of greatly depreciating in the coming years?
Some homes may seem to be good enough to stand for the mortgage loan now, but there could be problems in the foreseeable future that could drop the value of the home dramatically. For example, if the house is beside a large vacant lot that has already been purchased by a commercial company, the value of the home could be at risk of dropping once that commercial property is developed. If a lender feels a home's value could change for the worst in the coming years, they will likely be hesitant to offer a mortgage.
Does the home seem to be a good fit for you and your family?
Believe it or not, lenders do consider whether or not a home will physically be a good fit for you and your family. This is typically not a single deciding factor in whether or not you are offered a mortgage loan, but it something that may be brought up. The reason behind this is the lender will want to see that you will likely be pleased with the property once you move in. For instance, if you have four kids and another on the way, buying a small two-bedroom house may seem illogical to the lender.
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