A main cause of the subprime loan crisis and market crash of 2008/2009 was the abandonment by lenders of sound practices when qualifying prospective borrowers. Foreclosures naturally exploded. Lenders have now returned to more carefully scrutinizing borrowers and their ability to repay mortgage debt. As a result, it is now more difficult to secure a loan.
Properly planning for a home acquisition is essential. If you’re in the market for a new home and will need mortgage financing, we can help you better understand the qualification process, including how lenders use debt-to-income ratios and other qualification methods. Knowing what to expect and what costs are involved in advance is important in helping you secure the loan you want and need and in making the best impression possible during the application process.
We can also help you to determine just how much debt you can truly afford (often a very different figure than the loan amount a lender is willing to extend) based on your specific situation in order to help you avoid making common and costly financial mistakes.