Many first time home buyers think the idea of a home loan
is appealing. It is difficult to afford a house when you’re
just starting out, and you can probably use all the help you
can get. Many consumers who need loans do not apply for them
merely because they believe they will be turned down.
You need to realize how many options there are, and how Countrywide
Home Loans can help you even if you have poor credit. What
you need to do before you apply is gain more knowledge about
the loan process and how you are evaluated for qualification.
There are basically four areas that lenders look at when
they are determining whether or not to approve you.
The first is strictly the financial aspect of your application.
How much money do you have? The lender will wonder three things
in this area. First, how much cash do you have right now?
Will you be able to afford the closing costs and/or a down
payment if you are purchasing a home?
Second, will you have the ability to repay the loan? This
is a biggie. Of course the lender does not want to give a
loan to someone who is not likely to return it in full. It’s
like when your kids ask to “borrow” something.
How many times do they pay you back?
Although home buyers are not children, the same idea applies.
If you do not seem reliable, you may be rejected for a loan.
Third and last in the financial evaluation is your credit
history. Like the words Grade Point Average to a student,
these two words make most consumers cringe. But remember:
it may be a test of your budgeting and money management, but
one test does not mean everything. As Countrywide’s
motto says, your future outweighs your past.
The second part of the evaluation is focused on the home
you are buying or refinancing. The key here is the value of
your home. Your home is used as collateral for your loan.
It is kind of like a bet. You are betting your home, and if
you lose the bet (if you cannot repay your loan) then you
lose your home. If the property you are purchasing or refinancing
is not very valuable or is not foreseen to be valuable in
the future market, a lender may be hesitant to grant you a
loan. To find out the value of your home you will need to
hire an appraiser who can determine that for you.
The third and fourth steps to the loan application have to
do with the type of loan and the lender’s unique nature.
The type of loan is obviously what plan you have gone with,
such as fixed rate or adjustable rate. Then it depends on
the lender’s own traditions and standards. Some are
more lenient and some more by the book.
Some lenders demonstrate a more biased stance in their decision-making
process, while others are straightforward and precise. At
Countrywide, you are not a specimen to be held under a microscope
for the tiniest of financial flaws and failures. Countrywide
aims to give you the home you love by providing you the financial
freedom to afford it.