4 Ways to Enhance the Chances of Getting a Pre-Approval Mortgage

If you are deciding to buy a new house, then you must need a pre-approval mortgage to get the best deal that fits in your budget. You will get confused about getting a home loan because there are many banks and financial institutions providing home loans.

However, a year ago, it was simple to get a mortgage, but now lenders got strict with their borrowing requirements due to the housing crisis came to ahead in 2007. Here we are going to discuss some best ways to boost your chances of getting a pre-approval mortgage Aurora.

1. Enhance your credit score

Improving your credit score is going to increase your chances of getting a pre-approval mortgage. Commonly, it ranges from 300 to 850. And if you want to qualify for a mortgage, then you need a minimum score of 620. It does not mean that you guaranteed approval with 620.

Moreover, it also does not mean that you will get the best rates out there. So it becomes necessary to achieve the highest credit score like higher than 750. It is for sure that you will get the favourable rates with a credit score of 750 or above. However, enhancing your credit score can be easy.

It is like a GPA if you have more good grades, then more it will go up. Similarly, If you have a credit card with $0 balance, then you should put one small recurring charge on it like the phone bill and make sure to pay it off consistently.

You can set an automatic payment with your bank to avoid the accidental missed payments. If you want that this tactic works well, then you must avoid swiping your card on anything and racking up a balance. Lastly, you can leave your card at home to avoid the temptation.

2. Pay off some debt

Paying off some debt is also going to increase your chances of getting a pre-approval mortgage. However, if you are deciding to buy a new house, then getting a pre-approval mortgage is vital. So paying off some debt is going to help you get the mortgage in two ways.

Firstly, if you have less revolving debt, then more your credit score can improve. And as the credit score improved, the chances of getting pre-approval mortgage Aurora will increase. Secondly, you can pay attention to the debt-to-income ratio to measure your monthly obligations.

However, monthly obligations like bills and debt payments relative to your income. Keep in mind that if your monthly cost is lower, then more appealing loan candidate you will be. So if you have some debts to pay off, then do it to boost your chances of getting a pre-approval mortgage.

3. Secure a job

Most of the lenders do not provide a mortgage to the borrowers who do not have a stable source of income. So if you are applying for a mortgage, then you must need a steady job. But if you have an unstable work, then how can you expect to keep up with your mortgage payments.

On this time, you have to plant some professional roots. And once you have been with the same employer for several, months then apply for a mortgage. On the other hand, what to do if you are self-employed with variable income.

On this time, try to see for clients that will agree to an ongoing contract. Then you present this contract to the mortgage lender as proof of income stability.

4. Higher down payment

If you give a higher down payment, then lower will be your loan. Moreover, if you put a higher down payment, then it will also lower your loan-to-value ratio. And if the loan-to-value rate is high, then more risk your mortgage becomes from a lender perspective.

However, your chances of getting a pre-approval mortgage will increase if you can make a more sizable down payment and less risk will involve. If you can not buy a home, then you must need a mortgage to make it happen.

Final thoughts

The purpose of this guide to provide you with some four best ways to enhance the chances of getting pre-approval mortgage Aurora. However, getting a pre-approval mortgage is going to find you the best deal that fits in your budget.