Vero Beach home buyers need to be sure they'll qualify for a mortgage before they sign on the dotted line to buy that home of their dreams.
Qualifying for a mortgage alone is not enough these days. Vero Beach home buyers also need to know they are getting the best possible rate they can, as well as shop around for closing costs, because these can vary from lender to lender.
5 Mortgage Tips for All Vero Beach Home Buyers
1 – Document Your Finances. Vero Beach home buyers should be prepared for extra scrutiny by lenders when qualifying for a mortgage due to new mortgage regulations that went into effect in January, especially the new rules that prove borrowers' ability to repay their loans. You should be prepared to show bank statements, tax returns, W-2s, investment accounts, and documentation of any other assets you own. You should also be prepared to explain any sizable deposits to your bank account—even a $500 check from a family member for Christmas. If you can't prove where the money came from, it can delay your closing.
2 – Lock In Your Rate As Soon As Possible. Mortgage rates are expected to rise in 2014 as the Federal Reserve continues to phase out its $85 billion per month bond-buying stimulus program. A rate lock is usually good for 30, 45, or 60 days, although that time period can vary among lenders.
3 – Know Your Credit Score. The best mortgage rates go to Vero Beach home buyers with credit scores of 720 or higher. While those with a credit score of 680 can still likely qualify for a loan, you may end up paying a higher rate or more closing costs.
4 – Shop Lenders. Vero Beach home buyers may have the upper hand in 2014. Lenders have lost a huge amount of their refinance business as rising rates discourage home owners from refinancing. Vero Beach home buyers are the beneficiaries of the refinancing cutbacks, as lenders become more willing to compete for your business. Vero Beach home buyers need to shop around for more than just the best interest rate on the loan, looking at points and closing costs as well.
5 – Watch What You Spend. Vero Beach home buyers need to refrain from going out and outfitting their new home with all new furniture—on credit—before closing on the home loan. Lenders will be carefully scrutinizing your debt obligations, such as credit cards and student loans. Borrowers are advised to keep their monthly debt obligations, including mortgage and property taxes, to below 43 percent of their income. And just because you have been approved for a loan doesn't mean the loan is guaranteed. It's customary for lenders to pull your credit report a second time, just before closing, to see if you have done anything to change the credit line they approved you on to begin with.
We post periodic updates about Vero Beach mortgage rates and the news that affects those rates at our Vero Beach Mortgage Info link to your right under Vero Beach Real Estate Categories.