To qualify for a fixed-rate mortgage, we will look at your financial background to determine whether you have a manageable level of debt, steady income, and good credit history.
Debt to income ratio: We will review your debt to income ratio (DTI) to ensure you don’t have more debt than your income can manage. A recommended DTI, including your mortgage payment, is no more than 43%.
Steady income: Whether you’re self-employed or have a W2 job, we want to ensure that you have a stable work history showcasing your likelihood of being able to afford your home now and in the future. Two years of consistent employment are typically required to qualify for a home loan.
Credit history: Your credit score is a significant indicator of your financial responsibility. We will review your credit history and credit score to determine whether you have the background that showcases your ability to manage mortgage payments. Learn more about what constitutes "good" versus "bad" credit here.
Down payment: For in-house 25 & 30-year loans, a down payment is required no matter the credit score. The more down payment you put down, the lower your interest rate. The sweet spot is 20%. This also gives you more equity in your home to use down the road for getting cash out for updates, improvements, or emergencies that may arise.
While we look at these four factors to help you qualify for a mortgage, we also realize you’re a person and will review your full profile and speak with you directly to get you the loan you want and can afford.
