Looking for financing to get the home you’ve always wanted? You can explore a lot of financing options out there. One of the most popular ways to finance your home is to apply for a mortgage. Here are some essential tips to help you get your loan application approved!
- Don’t move the money
If you’ve got plans to take out a loan, then make sure you don’t move your money around. Don’t take it out of your bank accounts. Leave it there for 6 months. Too much movement can make it seem like you’re short on cash and that could make banks or lending companies doubt your capability to pay off the loan. Also, remember not to take out any personal loans 2 to 3 months before you’re set to apply for a major one. That could reduce your chances of getting the second loan approved.
- Know your costs
Knowing exactly how much you need to spend to buy the property you’ve been eyeing matters. It helps you plan your budget as well as rearrange your funds. One way to figure the amount then is to use tools like stamp calculators for mortgage on sites like PropertyGuru Singapore. With these tools, it’s easy to determine your costs and as a result, properly allocate your funds.
- Be specific
When banks or lending companies know exactly what you’re spending their money on, they tend to provide the loan at a lower interest rate. The more they know, the less risk involved for them, or at least that’s how they see it. So make sure you provide a detailed explanation in your loan application.
- Match it to the right loan
One reason some loans don’t get approved is because people are applying for the wrong one. For instance, if you want to borrow funds to finance your education, then don’t take out a personal loan but the education loan package instead. Did your home suffer devastating damage from the storm? Don’t take out a personal loan when there’s a perfectly good renovation loan package you can apply for instead.
- Double-check for errors
Sometimes, the reason your loan wasn’t approved is because you filled out the information wrong, or provided the wrong information. A wrongly spelled name can derail the process and make you start the application process over. So review everything before you submit your application. Check the accuracy of the dates, the spelling of your name or where you live, your birthday, along with the rest of your personal information. These are pretty basic but you’d be surprised at how many people make mistakes when it comes to the basics.
- Shop and compare
There are plenty of housing mortgages you can choose from. Don’t go for the first affordable rate you find. Look around until you’ve got a list of potential mortgage packages. Compare the features and interest rates. Also factor in the payment flexibility of the loan. Do this until you find the best one at a price range that’s reasonable for you and your wallet.
- Know what you’re getting into
Before you sign up, know or ask about the penalties for late payment. While you want to make sure your payments are always on time, you never know what could happen in the future. By knowing the consequences of a late or delayed payment, you’ll know what is at stake, which should push you to do your hardest to provide on-time payments.
- Read the fine print
Aside from knowing the penalties, look over every inch of the document so you know what rights and services you’re entitled to. That way, if the company should break or violate those rights, you’ll know, allowing you to take immediate corrective action.
- Be aware of the conditions
Money Sense provides a detailed table on what housing loan conditions go how much down payment. Use it as a handy guide to determine which bracket your loan should fall under.
- Don’t forget to check all the fees involved
Some banks might charge more than others. Ask about those charges so you know what services you’re paying for. Also, if you think the bank charges too many fees, you might want to consider switching to another bank for better-cost savings.
- Ask a professional
If there’s anything you don’t understand, consult a financial professional for help. You could also hire a real estate lawyer and agent to help you understand what steps to take as well as legal details that need to be seen to. With help, applying for a home can seem less intimidating for you.
Applying for financing is to first step to getting the home you’ve always wanted. So follow these tips to improve the chances of your application earning the approval it needs.