Understanding Your Borrower Risk

Will Lenders Let You Borrow?

When you think about buying a home, you probably think about the increased space, the outdoor area, and the other ways a new home could meet your needs. Your first thought is likely not about the lending aspect of home buying, but that does not mean that you can just skip this step. To help you understand if you will be seen as a risky borrower or if lenders will be happy to bring you on, here is a quick look at a few mortgage red flags.

  • Credit Under 620: A low credit score immediately signals to your potential mortgage lender that you have not been incredibly financially responsible in the past. If you are unsure about your credit score, secure a free credit report (you can get one each year from Equifax, Experian, and TransUnion) and check.
  • Unstable Employment: The ideal borrower has worked a 40 hour work week for a long stretch of time. Those who do not have consistent sources of income will find it more challenging to get a mortgage. Take a look at your tax returns to ensure you can verify consistent income.
  • Lack Of Assets: Even if you have excellent credit and a high-paying job, you will still need to save up for your down payment. Lenders will not be willing to underwrite your mortgage unless you can show that you have at least some money saved up to put money down on your house.

Buying a home is a dream everyone should be able to realize. Even if you have one of these red flags working against you, contact Cary Amo. As an expert real estate agent, I have experience helping people buy homes in Lafayette and elsewhere in Contra Costa County no matter their financial situation. To learn more about how you can become a homeowner this year, call me today!

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