People usually apply for a second mortgage or home equity loan when they need money for debt consolidation, to pay large expenses or for home remodeling and home improvement. Generally, fixed interest rate home equity installment loans (HELOANS) and adjustable mortgage rate home equity lines of credit (HELOCs) are what second mortgages are categorized as. The application and approval process is similar for both even though your decision will depend on your needs. With the help of these 9 tips, your loan process will be as hitch-free as possible.
Compare options like mortgage refinancing and other loan options to determine if a second mortgage is the best choice.
Make sure you can tell lender what the purpose of the loan is. Your answer will help determine whether or not you are approved.
Getting your FICO scores and checking your credit report for errors is what you need to do because your FICO scores will be reviewed by lenders in order to determine your loan rates. By checking "How to Improve Your Credit Score," you will learn more information about cleaning up your credit.
Comparing several home equity loan options is another thing you can do. By discussing your loan programs with your broker or lender, you can then find the best loan for your situation. It's also not a bad idea to get a good interest rate.
These items are included in the list of paperwork you would need to close the loan and this mortgage checklist will be given to you from your lender when you apply for a loan.
1. Copy of deed to property.
2. Recent tax appraisal.
3. Last two years' W-2's, tax returns and current pay stub, or two years' tax returns if self-employed. Be sure to include all schedules.
4. Lawsuit settlement, child support, alimony, disability payments, inheritance, or other source of income should also be included.
5. Copies of your last 3-6 bank statements.
6. List of all open credit accounts such as payment amounts, balances, and account numbers.
7. Your current mortgage statement.
8. Homeowners insurance information (account number, name, and phone number of agent.
9. If you fax the documentation from the checklist, then this will expedite the loan process more than mailing it.
Fill out your loan application thoroughly, or it may delay approval and loan closing.
Watch out for bad loans. The FTC or Federal Trade Commission warns that if the lender encourages you to falsify your application to get the loan, urges you to borrow more than you need, pushes you into unrealistic payment terms, shows up at closing with a different loan product than you agreed to, asks you to sign blank forms, or denies you copies of documents you signed, then you may be signing into trouble. What should you do if a lender rejected your mortgage application? Ask why it was rejected to find out what you need to do to secure mortgage loan approval in the future. Sometimes paying down some credit cards can increase your credit score just enough to qualify.
Compare options like mortgage refinancing and other loan options to determine if a second mortgage is the best choice.
Make sure you can tell lender what the purpose of the loan is. Your answer will help determine whether or not you are approved.
Getting your FICO scores and checking your credit report for errors is what you need to do because your FICO scores will be reviewed by lenders in order to determine your loan rates. By checking "How to Improve Your Credit Score," you will learn more information about cleaning up your credit.
Comparing several home equity loan options is another thing you can do. By discussing your loan programs with your broker or lender, you can then find the best loan for your situation. It's also not a bad idea to get a good interest rate.
These items are included in the list of paperwork you would need to close the loan and this mortgage checklist will be given to you from your lender when you apply for a loan.
1. Copy of deed to property.
2. Recent tax appraisal.
3. Last two years' W-2's, tax returns and current pay stub, or two years' tax returns if self-employed. Be sure to include all schedules.
4. Lawsuit settlement, child support, alimony, disability payments, inheritance, or other source of income should also be included.
5. Copies of your last 3-6 bank statements.
6. List of all open credit accounts such as payment amounts, balances, and account numbers.
7. Your current mortgage statement.
8. Homeowners insurance information (account number, name, and phone number of agent.
9. If you fax the documentation from the checklist, then this will expedite the loan process more than mailing it.
Fill out your loan application thoroughly, or it may delay approval and loan closing.
Watch out for bad loans. The FTC or Federal Trade Commission warns that if the lender encourages you to falsify your application to get the loan, urges you to borrow more than you need, pushes you into unrealistic payment terms, shows up at closing with a different loan product than you agreed to, asks you to sign blank forms, or denies you copies of documents you signed, then you may be signing into trouble. What should you do if a lender rejected your mortgage application? Ask why it was rejected to find out what you need to do to secure mortgage loan approval in the future. Sometimes paying down some credit cards can increase your credit score just enough to qualify.
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