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Essential Steps to Take Before Applying for a Mortgage: A Guide by Augusta Mortgage Company

The mortgage application process can seem daunting, but with proper preparation, it becomes a manageable and even exciting journey. At Augusta Mortgage Company, we’re here to guide you through the necessary steps to take before applying for a mortgage.

Review Your Credit Report

Your credit report plays a significant role in your mortgage application. Prior to applying, check your report for any inaccuracies and take steps to improve your credit score if necessary.

Determine Your Budget

Before you start house hunting, identify how much home you can afford. Consider your income, debt, and future financial goals. Remember, just because you qualify for a certain amount doesn’t mean you should borrow the maximum.

Save for a Down Payment

The more you can put down, the lower your monthly mortgage payments will be. Start saving early and consider various sources for your down payment, such as savings, investments, and gifts.

Gather Necessary Documents

You’ll need several documents for your mortgage application, including tax returns, pay stubs, bank statements, and more. Gathering these in advance can help speed up the application process.

Get Pre-Approved

A mortgage pre-approval can give you a competitive edge when house hunting. It demonstrates to sellers that you’re a serious, qualified buyer and can help streamline the closing process.

Consult with a Mortgage Professional

Each homebuyer’s situation is unique, so it’s beneficial to consult with a mortgage professional. They can provide personalized advice and help you understand the mortgage options available to you.

The path to homeownership begins long before you fill out a mortgage application. By taking these crucial steps ahead of time, you can position yourself for a successful homebuying journey. At Augusta Mortgage Company, we’re committed to guiding you every step of the way.

Ready to take the first step towards your home-buying journey? Reach out to Augusta Mortgage Company today for personalized guidance and support.

7 Common Questions from First Time Home Buyers

(This article originally posted on Blanchard and Calhoun’s blog and has been edited)

Buying a home is an exciting process.  It’s important to have an experienced and knowledgeable team of real estate professionals that will guide you through every step of the home-buying process. We know you have a lot of questions and we have compiled the most frequently asked questions by first -time home buyers and listed them below.

1. Where do I begin? The first thing you should do is get pre-approved. Being pre-approved means a lender has reviewed your financial situation and credit score and has approved you for a particular loan amount. 

2. How do I get pre-approved?  To get pre-approved, you will partner with a lender and fill out an application. The application will collect all of your financial information and check your credit score. Once you are pre-approved, you will know how much you can borrow and what price range home you should search for. 

3. I’ve been pre-qualified, is that the same as pre-approval?  No. Both prequalification and preapproval can estimate how much you may be approved to borrow but there is a difference between the two.

  • Pre-qualified does not require an application.  Although a credit report has not been run,  the lender has an idea of what you could get a loan for based on a very basic review.  
  • Pre-approval requires an application. The information from the application will determine whether you will be offered a loan and at what interest rate. A pre-approved individual has been approved for a specific mortgage amount providing that nothing changes with the applicant’s financial situation or credit score.

4. How do I begin house shopping?  Once you have been pre-approved, you and your real estate agent will partner together to look for homes based on your search criteria.

5. Where do I find a real estate agent?  You can find a knowledgeable real estate professional by clicking here.   

6. How much does it cost to hire a buyer agent? Typically, the buyer does not pay the agent. The seller will most likely have a contractual agreement to pay the commission fees; however, you will still want to discuss the fees (if any) with your agent. 

7. How much do I need for a down payment? Your down payment will depend on your lender’s requirements and the type of loan you qualify for. 

Don’t see your question here? Contact us anytime. We are more than happy to answer any questions you have and to help you with buying your first home.