America's Paradise - St. Croix USVI Real Estate and Vacation Listings

Mortgage Pre-Qualification

Seek Pre-approval

Viewing homes you can't afford makes houses in your price range pale in comparison. This obviously is not the best use of your time and will lead to frustration and disappointment later in the process. A few minutes of your time, invested up-front in getting pre-approval, will assure you a much more satisfying buying experience. Most local banks and mortgage companies can give you pre-approval in 24-48 hours, if you are prepared with the right financial information.

Credit Report

The starting point for any mortgage pre-qualification will be your credit report. If you can obtain a copy of your credit report in advance, you will be able to explain, or correct, any issues referenced on your report (a copy of your Experian credit report can be obtained by calling 1-888-397-3742). Becoming familiar with this report can help avoid possible loan approval delays.

Your Down Payment

Here is where you will need to pull out your calculator and determine how much you have saved for the down payment on your new house. You will generally need to have a minimum of 10% of your new home's purchase price. Also, you will need to provide for closing costs. The loan officer you speak with will be able to estimate your closing costs for you.

In addition to your down payment funds, an emergency fund should be maintained to provide the capacity to pay for any unexpected events.

Existing Loans

Be prepared to provide detail regarding all of your present debts, including creditor name, amount owing, monthly payment, account number, etc. This will be used in calculating lending ratios, which will be compared to pre-determined lending guidelines.

Salary & Income

Gather your W-2's and latest paycheck stubs together. If you have other sources of income, be sure to give this information with any supporting documentation, to the loan officer. This will be used in calculating the above lending ratios and determine your debt capacity. As a rule of thumb, your housing costs should total no more than 28-32% of your monthly income before taxes.

Mortgage Options

Your loan officer will be happy to discuss the various mortgage options available to you (fixed rate, adjustable rate, balloon, government-insured). Do not hesitate to ask questions.

Remember, asking a mortgage professional to pre-qualify you for a specific loan amount will:

narrow your home search to the appropriate price range,

help avoid disappointment,

improve your bargaining power, and

speed up the entire loan and buying process.

If you would like a contact list of local bank and mortgage company loan officers, please contact me.

All information provided is deemed reliable but is not guaranteed and should be independently verified. Any reference to services or publications should not be construed as endorsements but are provided merely as a convenience to the reader. All properties are subject to prior sale or withdrawal.