With the recent collapse of the U. S. Financial markets, obtaining a Georgia home mortgages can now be quite a chore. Long gone are the days where a 620 FICO score, verifiable income, and a promptly paid previous or current home mortgage were just about all you needed to get a new mortgage. We are truly in a different world when it comes to finance.
Of course, lenders are not turning away everyone, but they are turning away people who would have been approved overnight only two years ago. Today you need miles and miles of documentation, paperwork, forms, statements, IDs and a credit history straight from a fiction novel, and forget about getting a ‘no doc’ mortgage!
Another thing you won’t find any more is the ability to borrow extra money to pay off your debts. In the past, if your debt to income ratio was too high, banks would add this on top of the amount needed for the Georgia equity mortgage. This is now almost unheard of. If you owe too much money, you most likely won’t qualify for the mortgage.
If a 20% down payment will be an issue, you might find yourself priced completely out of the market. Even though housing prices have fallen dramatically over the past few years, your median priced home in most markets is still hovering around $200,000, bringing your down payment alone to $40,000. This doesn’t even take into consideration closing costs and residual cash the lender expects you to keep on hand for emergencies.
However, if you think you’re all set and lenders are just dying to give you the money you need, you still have plenty of prep work ahead of you. Research lenders carefully; after all, you should be just as leery of them as they are of you. It’s a two way street. Get as much data from them as you can before sending in an application fee. Chances are, you could lose the entire sum if you aren’t approved, and yes, many companies actually make most of their money just collecting these fees without any intention of lending mortgage funds.
As opposed to only a few years ago when banks merely asked for three months of bank statements to prove a reliable income stream, they now ask for one to two years of statements. This actually could be to your benefit since if you had a few months with decreased income due to a layoff or similar situation, it gives you the chance to show a recovery period afterwards. If you don’t tend to keep your bank statements for long, see if you can print them out from online or pay a fee and have the bank send you duplicates.
Collect statements from all accounts including savings, money markets, annuities, and brokerage accounts. No matter how confident you are that you will easily be able to pay your mortgage, your lender wants proof positive. This level of preparation is key to your approval.
When talking to lenders, get as much information as possible up front without giving them an application fee. In many instances, these fees are non-returnable if you aren’t approved. If you happen to be dealing with a mortgage broker, just remember to ask many questions and make sure that you are comfortable with the home equity loans you are considering. It is important to know all the facts in order to make an educated decision.
