Portugal Real Estate Homes

A Leading Portuguese Real Estate Broker Agency

Applying For A Home Loan

 Applying For A Home Loan

When applying for a home loan, you will have to bring the information listed above to the lenders office, or if applying online, supply copies that are faxed to the lender. You will be asked additional questions that will help lenders determine if you are able to pay the loan back on time. These questions include:

  • Number of years renting a home or apartment
  • Late payments on credit cards and other loans
  • Active loans (such as student loans or car loans)
  • Number of years at your current job
  • Additional income
  • Amount of the loan and number of years to pay it back
  • Number of years living in an area
  • Dependants that are living at your home
  • Tax returns and bank statements

Applying for a loan can take a week or more. This is because background checks, credit checks, and references must be checked first before the loan will be processed.

In the meantime, you should be concentrating on gathering your paperwork, calling friends and family that you want to use as references, and sorting through your papers in case you cannot find everything the lender requests.

If you do not have your back tax returns, you can contact the IRS and request them by year. Many times, lenders will need to see returns from at least three years ago. Bank statements and bill statements from the past year should be enough to secure a loan.

If you are turned down for a home loan, you will be notified as to the reasons why. This can be devastating, but you should find other lenders and try to apply again. If you have poor credit, you may need to go through a lender that specializes in granting loans to those with poor credit. You may have to pay a higher interest rate, but at least you will be granted a loan.

Reasons for possible denial include:

  • Poor credit or not enough credit
  • Length of time at your job is too short
  • Income level for the amount of loan requested
  • Loan default
  • Failure to pay rent or other bills, or
  • Too much credit

Applying for a home loan can be stressful, but if you have good credit, steady employment, and enough income, you should have little trouble qualifying for a loan.

What Not To Do When Applying For A Home Loan

There are a few things you should not do after applying for a home loan:

  • Buy a new car
  • Begin a new job
  • Buy new furniture and other large items using your credit cards
  • Apply for a credit card, or
  • Default on student loans or other loans

All of these actions will cause your credit score to change which will give lenders an inaccurate view of your spending habits and your overall credit score. If you take a job that pays less than you noted on your home loan application, your lender may not agree to grant you the loan.

If possible, do not begin a new job until you have moved into your home. Try not to spend money on credit cards. Buy furniture and other items using cash, or wait until you have signed the final contract and are a homeowner.

Sound Real Estate Investment Advice - Investment in Knowledge