Why Is Buying a Home So Complicated?

Buying a home should be a positive, exciting experience. Even when everything goes according to plan, though, the home buying process is notoriously complicated. On the long list of details and documentation you must prepare to begin the process are your finances and credit score. Both of these elements are essential to aid you in qualifying for a mortgage. But what else is needed when you’re ready to buy a home? The mortgage professionals at Rex Homes have provided a complete guide through the complicated process without having you lose your mind!

What to Look Out for When Applying for a Mortgage

Applying for a mortgage is perhaps the most stressful part of the homebuying process. However, mortgage brokers can help you manage this process. They are a go-between who deals with banks or lenders to help you get a mortgage and require a Certificate IV in Finance and Mortgage Broking before they can start practicing.

Several tasks need to be completed to make sure you’re credit and finances are in a place to qualify for a mortgage, one of which is your duty to provide recent bank statements representing the last two months of your income. (For these documents, you will likely be required to have the teller sign and date the statements.)

photo/ mohamed Hassan

When you’re collecting these statements, pay close attention to all the details included – because your potential lender sure will. They will be searching for things like overdrafts and irregular deposits, specifically those amounting to $200 or more. In these cases, they’ll most likely request a letter of explanation for these deposits, to ensure that your stream of income is what you claim. Many times, lenders will ask for the source of any monetary gifts and request bank statements from those individuals as well. 

You may also receive conditional approval for a mortgage and submit all the required documents, only for the lender to impose even more conditions! This causes many prospective homeowners to lose their patience. Even if you are constantly asking yourself why home buying is complicated, don’t give up. There are some things you can do to make this process a bit smoother for yourself.

Tips on How to Make Homebuying Easier

To make your experience of buying a house a bit easier, you must apply the following tips:

1. Shop smart for a mortgage. Do not allow every lender under the sun to pull your credit. This will ultimately harm your credit score and hurt your chances of qualifying for a good mortgage in the end. Have a copy of your credit report handy as you shop around for a mortgage so you find the best one to suit your needs.
2. Budget for all costs associated with buying a home. This doesn’t just mean saving up for the price tag on the home. You must also prepare for any transitional costs (for example, you may have to cover rent and mortgage as you move from previous home/apartment to the new house), professional movers, furniture, etc. 
3. Get your property abstract. Some homeowners may be required to keep the abstract of the title of the home. This document holds the history of ownership of your property and can be costly to replace if lost. 

There are many elements to be aware of when you are shopping for a new home. With the help of a mortgage professional, you can be fully prepared for the road ahead. Follow these tips and enlist the help of a mortgage broker today.

Author: Gourav Rana

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