Taking out a mortgage is a paper-heavy process that can be simplified by understanding how it all works and what you should do to help your application sail through to approval. 

Here are four quick steps to take to help make this process easier:

1. Check your credit before applying for a mortgage.
   
   This first step is very necessary because mortgage approval and pricing can mostly depend on your credit scores. The higher your scores are the more likely you will be approved and get a lower interest rate on a home loan.
   
   By checking your credit report ahead of time, you give yourself time to correct any issues which may hinder your approval. Most mortgage lenders will not approve your application if you have a credit score that is lower than 620.
   ‍
2. Make sure to prepare the required financial documents.
   
   Having the proper financial documents ready to go will drastically reduce the amount of time it takes to get through the application process. 
   
   Expect to provide your basic information, bank statements, earnings statements,investment statements, other current loan documents, completed and signed income tax returns. 
   
   If you are self-employed, likely copies of bank statements, recent business returns, and income statements.
   ‍
3. Choose the right mortgage lender.
   
   There are tons of lenders in your area, which can be overwhelming at times. Look out for red flags such as a lender advertising rates that are well below market, but also look for lenders who may offer discounts based on investments made through their bank. 
   
   A number of banks will give discounts on mortgage rates to borrowers who also open investment accounts that meet a required minimum deposit amount. 
   ‍
4. Select the best mortgage program for your situation. There are many different types of mortgages to choose from, as well as different types of loans within each basic mortgage type.
   
   With a fixed-rate mortgage your monthly payments and interest rate stay constant throughout the term of the loan.
   
   An adjustable-rate mortgage has a set payment plan and interest rate that for the beginning of the term that will later revert to a one-year adjustable rate.
   
   If you plan on spending many years in your home then fixed-rate mortgages are the best option, while adjustable-rate mortgages can be better if you plan to sell the property within the initial rate period.  Consulting with a Financial Planner is very important during this phase.

Now, time to get pre-qualified and start shopping for a home!

Understanding everything that goes into choosing a mortgage, shopping for the perfect home becomes much easier and more enjoyable. Reach out the 2050 team for more tips on your mortgage application.