Financing,Timeline,for,Home,Bu finance, share, loan Financing Timeline for Home Buyers
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Many buyers ask us when they should start looking into financing for their future home purchase. Its important to start looking as early as possible into financing. If you think you may run into some credit issues, it would be a good idea to talk with a credit counselor (or your lender) about a year from your estimated move date. He or she can recommend ways that you can improve your credit in the coming year so that you can get qualified for the amount you need when the time comes. The timeline below starts three months out from the estimated move-in date. However, if you find yourself in a shorter time frame for buying, just be sure that you stay in good contact with your lender so that you can get them the information that they need! And remember, the more secure your finances are when its time to make an offer on a home, the better your negotiating power will be! 3 months out: Talk with at least one lender about your plans for financing the home. Some buyers prefer to talk with more than one lender so that they can compare loan products. I wouldnt recommend talking to more than two or three lenders, though, since the options among different lenders arent that drastic. Be sure to ask about your expected monthly payment as well as the down payment that youll make at closing. Your lender may want to go ahead and get you pre-qualified, which means youll need to gather some information for this process. Eventually your lender will need the following information: pay stubs for the past month, bank statements for all accounts showing past two months, address (and landlords name, if applicable) for past two years, employer contact info for past two years, and W-2 tax statements for past two years. You can also ask your lender if there is anything you need to do in the next few months in order to improve your standing. Using your information, your lender will be able to give you a price range for homes that you can afford (or a price range for homes that wont exceed the monthly payments that you want). 2 months out: Start looking at homes! This is the fun part! If you find that the homes in your price range are smaller than what you need, you can always talk with your lender to see if there is a way to get approved for a larger loan. If your lender hasnt already gotten all of your financial info at this point, he or she may be able to go ahead and crunch your numbers. In the next two months, dont make any large purchases (such as furniture, cars, etc.) or move around large sums of money (large depends on the size of the account, but a good maximum is $1,000) in and out of accounts. Its important to keep your accounts relatively stable in these last two months before closing. 1 month out: At this point, you should have narrowed down the homes on your list to a home that you will make an offer on. It takes about thirty days to close on a home (give or take), so you should make an offer about a month before you plan to move into a home. Once youve narrowed down to a single home, you can go ahead and lock in your rate on your loan. If your lender hasnt already asked for your financial information, the latest that he or she can get it and still get you approved is about three weeks to closing. After youve gotten pre-approved, your lender will give you a pre-approval letter that you can give to the seller. Ideally, you should include this letter in with your offer, as it will help your negotiating power to be able to show the seller that youll have no trouble with financing. However, if you get the pre-approval letter after youve already negotiated, the seller may still want to see that youre pre-approved so that he/she doesnt have to worry about taking the home off the market for several weeks for a buyer who cant actually afford the home.
Financing,Timeline,for,Home,Bu