7 Helpful Manufactured and Modular Home Financing Tips
The purchase of a new home is an exciting time for everyone. At times, it might even be a challenge just to stop daydreaming about how wonderful your new home will be. As exciting as it might all seem, make sure not to get too carried away—you don’t want to venture into homeownership without educating yourself first.
Below, we share some manufactured and modular home financing tips to help you get all of your ducks in a row first. If you follow these steps, you’ll have a greater chance of your mortgage application being approved, and you’ll be more likely to get the best home loan available to you.
Obtain Your Credit Score
You’ve been paying your credit card, auto loan, and other bills on time, each and every month. Chances are your credit score is probably high enough, right?
In fact, there’s only one way to know for sure—you must pull your credit score. Many different factors influence your score, so it’s hard to predict what yours might be without actually pulling it. In addition, identity theft is a persistent threat, and could severely impact your score without you even realizing it.
Gather Your Financial Documents
The home loan process is complex and involves a multitude of documents. In addition, you may find that you need to move quickly to take advantage of a low-interest rate. If you enter the process with all your documents prepared, it will be much easier for you to fulfill necessary requests promptly.
To start, you’ll need your most recent W-2, your last two pay stubs, tax returns for the last two years, and current statements for all bank accounts.
Before you begin to look at new homes, it’s best to get pre-approved for a home loan. You need to know how much the bank will loan you, and have a general idea about how much your monthly payments will be. If you start shopping for homes first, you may end up falling in love with a home you can’t comfortably afford.
Stick To Your Budget
It’s not uncommon for banks to approve homebuyers for more than they can actually afford. Take a moment to examine your lifestyle and how a new, monthly mortgage payment might affect it. Determine your personal maximum—it may or may not line up with the bank’s pre-approval—and then look for homes priced below that number.
Be Prepared For Cash Expenses
Except with a few specific financing options, you’ll need a down payment for your home purchase. Usually, you can expect to put down at least 3.5% of the purchase price, at a minimum.
You’ll also want to set aside money for a home inspection, home appraisal, application fees, and other closing expenses.
Don’t Change Jobs
Lenders use the information you provide at the time of application to approve or deny a loan. If a lender approves you, wait until after the loan process is complete to make any changes to your employment or income status. Any change in your employment or income during the process will significantly delay it, at best. At worst, it may result in you being denied for a loan altogether.
Pay Down Your Debt
It’s best to enter the loan process with as little debt as possible. Lenders evaluate your debt-to-income ratio to determine if they’ll approve you for a loan. Your monthly debt payments shouldn’t amount to more than a certain percentage of your monthly income, and you’ll get a better rate on your loan if your debt-to-income ratio is lower.
In addition, do your best not to add to your debt during the loan process. Lenders will pull your credit once more before closing, so it’s best to wait to make major purchases until after you’ve closed.
Applying for a home loan can be both an exciting and stressful experience. However, if you prepare yourself financially by following the steps we’ve outlined here, you’ll take most of the stress of out the process altogether.
Visit Manufacturedhome.loan, specializing in manufactured and modular home loans. Let them help you make your financing process as easy and as stress-free as possible!