FSIR Insider | Top 5 Tips for Mortgage Borrowers in 2014livxmin
Great mortgage deals are still available for buyers and homeowners, but you may want to act fast. Here are some tips that can help you stay on top of your finances, act quickly, and secure attractive rates.
1 – Document your finances | In 2014, lenders will be extra diligent when underwriting home loans. Lenders will feel added pressure to ensure borrowers have the means to repay loans. As new regulations go into effect, you will want to have good records of your finances, including bank statements, tax returns, and an accounting of all investments and assets. Be ready to explain any unusual deposits to your account, which could delay your loan processing.
2 – Lock in a rate as soon as possible | The Federal Reserve is expected to reduce the pace of the economic stimulus program which is partially responsible for holding rates to the low levels we have come accustomed to today. In 2014, rates will likely climb, so you want to act quickly.
3 – Refinance now – if you still can | Homeowners who are still paying more than 5% interest on their home loans may still have the opportunity to refinance at a lower rate. Do your research and explore your options.
4 – Take good care of your credit | Without decent credit, it is nearly impossible to get a mortgage, and this will continue into 2014. Monitor your credit history and credit score until your loan closes for any unexpected changes.
5 – Don’t overspend | Lenders will shy away from buyers who have minimal funds left each month after paying their mortgages and other debt obligations, such as credit cards and student loans. If that becomes the case, you may not qualify for a loan because your debt-to-income (DTI) ratio is too high. Tip: Keep your monthly debt obligations including mortgage and property tax below 43% of your income.
Although mortgage rates will likely climb in 2014, it is not time to panic. Do your best to move quickly in order to take advantage of today’s low rates, but remember, this is one of the biggest financial decisions you will ever make in your life – take time the time to seek professional advice.
Fuller Sotheby’s International Realty broker associates understand that a home, regardless of its price range, reflects the incalculable value of the life within. Looking to make your next move? Contact us at 303.893.3200 and speak with a qualified professional who can point you in the right direction. More information available at www.fullersothebysrealty.com.