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Getting Approved For a Wisconsin Mortgage
A mortgage approval and a loan pre-qualification (commitment letter) are two different things, but part of the same overall process for purchasing a property in Wisconsin or refinancing your Milwaukee home loan.
Typically, a mortgage professional representing either a bank, lender or mortgage broker will be who you will be dealing with when applying for a new loan, getting rates quotes, discussing fees and submitting documents to.
Speak with a mortgage loan professional. We recommend Joshua Bucio at (414) 305-1844 or [email protected] Ask questions and learn more.
Qualifying For A Home Loan in Wisconsin
In recent years since the real estate bubble popped, getting approved for a mortgage has become a slightly more labor intensive process for both borrowers and mortgage professionals. Additional regulations and laws set forth by the government require lenders to heavily scrutinize a borrower’s ability to repay a home loan.
A good Milwaukee mortgage professional should be able to clearly articulate this complex process in a manner that you can understand to help you make the most confident and informed decision about your various options.
While much has changed with regards to the availability of mortgage financing to the masses in light of the foreclosure crisis that swept the nation starting in late 2006, the “Four C’s” of underwriting standards have remained consistent throughout history.
CAPACITY is the analysis of comparing a borrower’s income to their proposed debt, which includes the new mortgage payment and any other monthly liabilities that may show up on a credit report. Basically answering the question as to whether or not the new mortgage payment is within the borrower’s ability to repay.
CHARACTER refers to a borrower’s credit history and credit score. Make sure that you are keeping your credit card balances below at least 30 percent of your credit limit. keeping your balances low and keepiong accounts open can result in a higher credit score in most cases. If there so happens to be an outstanding account in failed payment, a letter of explaination as to why this is would usually be required to keep the process going.
CAPITAL is in reference to your assets. During this step of analysis, the lender typically reviews bank statements to verify that the borrower has the sufficient amount of funds available for the down payment, closing costs and other such fees. Any assets (gifts or loans) larger than a few hundred dollars will need to be explained in document.
COLLATERAL is also known as the actual home. An evaluation of the home’s condition and value is generally baseed off on the home’s appraisal during the appraisal process. All repairs of the home must also meet the program’s guidelines, and any other property used as a comparison to the collateral must be as similar to one another as possible.