Important Things You Should Know About Mortgage Preapproval

January 14, 2021 by Cindy Steelman

One of the biggest purchases anyone can make is a house that will turn into a home. Chances are, however, that you will need to finance the investment with a home loan. A big advantage when hunting for a house can come in the form of mortgage preapproval; in some ways, it is practically a rite of passage that launches the long process of property purchase.

Here is what you need to know about mortgage preapprovals:

What is a Mortgage Preapproval?

A mortgage preapproval is a document or letter that declares exactly how much a lender is willing to lend you so you can pay for the house you are buying. It is a crucial step in the process of buying a home.

Whether you’re a first-time home buyer in Roseville or you have done this before, the preapproval process will be the first piece of the puzzle. Knowing how much you can afford allows you to look for properties within that price range rather than waste time with homes that are out of budget.

Once you have narrowed the list of potential properties down to a few top contenders, it will be time to extend offers. Sellers will be able to see that you have already been vetted by a lender and will thus be able to pay them for the property. That estimate can be used by real estate agents and sellers alike, in order to figure out whether or not you are indeed a serious contender for a house.

How Do Lenders Determine an Amount?

The foundation of preapproval lies directly within your financial situation. Lenders will look into your credit with a hard inquiry in order to determine just how worthy you are of credit. They will request your bank statements and retirement statements to assess how much you have in your bank account. They will request your paystubs and your federal tax returns to check on your income. These 3 items are the main requirements of getting a preapproval letter.

With the information provided, lenders will then be able to calculate a rather fair estimate as to just how much you can afford in terms of buying a house. They will then have the option of preapproving you for a loan amount based on your situation.

Being preapproved by a lender means you have been pre-underwritten and can go shopping for a property. Of course, if your financial situation drastically changes during your search for a home to buy, there is a possibility that your preapproval will get affected.

What are the Benefits of Being Preapproved?

A key benefit of preapproval is that sellers as well as real estate agents will have a clear sign that you are very serious about making a purchase. Moreover, they will be able to tell that you can actually afford the house you are trying to purchase. When you have Interest in a house that moves and you want to make an offer, the pre-approval letter makes your offer stronger than without it. The seller and the realtor will want to make sure that you can actually pay for it and follow through.

When you are able to get a clearer picture of what you can qualify for, what your monthly payment will be and what cash to close will be required; this will help you to decide what price range you can qualify for and want to stay within.

Not having a preapproval could mean that someone who has a lender and a preapproval will be favored over you.

Get Preapproved in Roseville with Steelman Mortgages

Preapproval plays a vital role in being able to buy your new house. Submit the necessary documents and go through the credit check, then go ahead and start your home buying journey! For best results, it is likely best to seek professional guidance on mortgages.

Looking for a mortgage lender in Roseville? Contact Steelman Mortgages at (916) 847-7263! We can’t wait to help you whether you’re a first-time home buyer or someone looking into reverse mortgage and other similar needs.

Who Can Benefit from Bank Statement Home Loans in California?

January 13, 2021 by Cindy Steelman

California is a great state to live in for many reasons. You get to enjoy a great climate in most places, all while enjoying cultural diversity and plenty of progressive policies that make it the dream destination of most people. However, buying a home in the area can be challenging for many new homeowners. Still, most places in California have been well-developed and are ready for inhabitants to stay for long periods.

First-time homebuyers in Roseville might experience challenges with the whole process, which can be off-putting when they can’t find the right deals. Any place has its respective markets, and these can vary depending on a multitude of factors. However, before making any moves, it pays to consider the investment you’re making on a residential property in California.

Bank Statement Home Loans in Roseville

Securing home loans in Roseville is quicker than you might think, as there are plenty of lenders available to first-time buyers. While some might not meet the requirements of other loans like jumbo loans or conventional ones, bank statement loan programs can be of assistance. Plenty of factors play into how a person can secure the best rates for their mortgages, such as credit history, debt-to-income ratio, and other factors that determine financial responsibility.

Roseville is home to plenty of new developments, making it a destination for many young professionals and entrepreneurs. While it can be a daunting task to secure home loans, bank statement loans can be used nowadays to secure financial assistance to purchase a property. This system works by verifying income with bank statements instead of pay stubs or tax return documents. If you find that you have a good credit score but lack substantial income on your federal tax returns then, bank statement loans are a prime choice.

Seasonal Employees and Bank Statement Home Loans in Roseville

Some people working in seasonal industries might not have a steady income all-year-round to sustain traditional home loans. These people might take odd jobs due to not being currently employed, while others might freelance to help pay the bills. Nonetheless, taking on a conventional loan will divide the value of your annual payments into 12 months and not six. This spread makes it nearly impossible to secure a traditional loan because it results in a high debt-to-income ratio.

However, with bank statement home loans in Roseville, using your income per month can secure you a deal with a lender. You need to be working for the seasonal company for at least two years to qualify, but this is an excellent option considering how large home payments can be for those with varying income throughout the year.

Commissioned Work and Bank Statement Loans

Commissioned workers are more prevalent nowadays, as the industry is significant for people who need work done via freelancing. Since freelancing never brings home an equal amount of money for each commissioned piece, it can be challenging to secure a conventional loan. Some months can have exorbitant amounts of money, while other months are stale. The gig isn’t a steadily paying job with a monthly salary however it can be averaged over 2 years by using your federal tax returns. However, if your income on paper is too low then the bank statement program is something to consider.

Home Loans Expert in Roseville: Steelman Mortgages

Bank statement home loans in Roseville can help those who are young and new to the workforce. Without the need for a comprehensive set of documents to prove that you qualify for lenders’ money, this is best for those who have decent-to-good credit scores and unique job situations. Contact your local lender today to help you with the first-time home buying process.

Steelman Mortgages is a top mortgage company in Roseville, California who can help with home loans of all kinds. Secure your dream home in the beautiful West Coast by contacting our brokers today! Call (916) 847-7263 for more information.

Fixed or Adjustable: Which Mortgage Type Is Better?

January 8, 2021 by Cindy Steelman

Home Buying Tips in Roseville California

Choosing a mortgage can be extremely stressful and confusing, especially for a first timer. Should you go with a fixed-rate loan or one with an adjustable rate? This article aims to answer this question and help you make a decision.

However, if it is your first time to take out a mortgage, it is still best to talk to a mortgage loan specialist to ensure that you make the right decision as to which type of mortgage to get. Here is a quick summary of the types of mortgage loans available to help lay the groundwork before you talk to a mortgage specialist.

What is a fixed-rate mortgage loan?

As its name suggests, a fixed-rate mortgage is a loan that will have the same payment amount for the entire duration of the term. The amount of the monthly mortgage payments and the interest rate will not change. Usually, the loan term for fixed-rate mortgages ranges from 10 to 30 years.

The advantage of taking out a fixed-rate mortgage is that the interest rate stays the same throughout the whole term. This will enable a person to anticipate how much they will pay every time. It will allow the person to allocate a certain amount in their monthly budget for their mortgage, as it will be predictable every time.

What is an adjustable-rate mortgage?

Adjustable-rate mortgages, or ARM’s, come in varying interest rates. The unpredictable nature of adjustable-rate mortgages is caused by the interest rate. At the beginning of the loan term, the interest rate will usually be much lower than that of fixed-rate mortgages. This will usually be a way to entice borrowers to take this type of loan.

ARM’s usually have a fixed payment period of 1, 3, 5, 7, 10 years. After the fixed period the interest rate will begin to fluctuate with the market, usually the LIBOR. The ARM interest rate is tied to the LIBOR and will adjusts as the LIBOR adjusts. The adjustable period can be each month, every 6 months or once a year meaning your interest rate and your payment will change each time it is time to adjust which will be included in your Note that you sign when you take on the mortgage.

The advantage of this type of mortgage is that your interest rate can be lower but that depends on what is going on with rates at the time. Another advantage is to take a lower payment for a short amount of time know that you will sell or refinance the property during the lower interest rate and payment time. These loans usually have a balloon payment due at the end of the time period.

Making Your Choice

It is important to consider your financial situation before making your decision as to which type of loan to get. If you like to stick to a budget, the predictability of a fixed-rate mortgage will suit you. However, if you are ready to take a calculated risk for some of your monthly interest rates to be cheaper than others, you may want to consider an adjustable-rate mortgage.

However, choosing a mortgage should not only be dependent on the interest rate. This is why it is a good idea to consult with a mortgage specialist before making your decision.

Mortgage Loan Experts: Steelman Mortgages

Now that you have been armed with the knowledge about mortgage loans, you are better able to make informed decisions about which type of mortgage to get. It is unwise to make the decision based on what an acquaintance, friend, or family member did when they took out their own mortgage. Keep in mind that each person or family has different needs. It is vital to analyze your own needs first, as well as how you will be paying for your mortgage before you make a decision.

If you are still confused about which type of mortgage may benefit you the most, you have the option of contacting a mortgage loans company to get more information about these loans. The specialists who work at these companies will be happy to discuss the specifics of each type of loan with you and help you make the best choice.

Whether you are looking for more information on mortgage loans, or if you are ready to take one out, Steelman Mortgages can lend you a hand. Interested parties can call (916) 847-7263 to get help with their mortgage in Roseville today!