Mortgage for a first time home buyer
To qualify for a mortgage for a first time home buyer is not as difficult as it may seem. In order to qualify for a mortgage for a first time home buyer, a person needs to show proof of income for the past two years. It has to be verifiable income. If you work as a waiter or waitress and get cash tips and do not declare it on your income taxes, we cannot use that income to qualify for a mortgage for a first time home buyer.
Income Qualification for a first time home buyer
If you have a full time job and have consistent overtime and had conistent overtime for the past two years, we can use both your full time hourly income plus your overtime income to qualify you for a mortgage. The past two years overtime income will be averaged. For example, If your overtime income for 2011 was $8,000 and for 2012 it was $9,000, the income we will use for mortgage qualification will be $9,000, which is the average of the two years overtime. Most mortgage loan borrowers make the same annual income for the two years but if one year is higher than the other, we either average the two years of annual full time income or we take the lower of the two year;s annual full time income, depending on the lender we take your mortgage file to.
Credit Tradelines for First Time Home Buyer
To qualify for a mortage for a first time home buyer, most mortgage lenders want to see that the mortgage loan borrower has at least three credit tradelines and that those credit tradelines’s payment have been paid on time for the past twelve months. Examples of credit tradelines are credit cards, student loans, auto payments, and other installment loans. If you do not have the three traditional credit tradelines, we can use non traditional tradelines like rent payments, cable tv payments, and cellular phone payments. It is important that whenever you pay your bills like your rent payments, you pay it by check because a mortgage underwriter will want to see cancelled checks as proof of payment in the event if they use non traditional credit to qualify for mortgage for a first time home buyer.
There will be a credit check that will be use to qualify a mortgage loan borrower and see the level of risk. Credit scores are extremely important and having a good credit score will qualify you for a better mortgage rate.