Increase Your Chances of Getting a Pre-Approved Home Loan8 September 2022
The process of looking for a house is the most thrilling part of purchasing a house. Because of the several types of property available on the market, it's simple to feel overwhelmed, but in the end, you need to ground yourself in reality by limiting your search to what you can really afford.
Practically every human being has a secret desire to one day be the sole owner of a house and an adjoining plot of land, a haven where he or she may feel fully protected and secure. Your dream house is just right out there, but before you start looking, it's important to take stock of your financial situation.
What is a Pre-Approved Home Loan?
Pre-approval for a mortgage loan is shown by a letter from the lender specifying the maximum loan amount you may get. Take note that this is not yet the final loan agreement, but rather a confirmation that you have been approved for the lender's home loan conditions and that the loan officer has reviewed your credit and financial profile such as your bank statements, debt, and income.
The pre-approval letter may also include information on the loan interest rate and the amount for monthly payments. Once your application for a house loan has been granted, you will get a confirmation in writing. Real estate investors may rest easy knowing you've already begun working with a lender that is willing to provide financing after reading this letter.
Check the article down below for additional information on the pre-approval process for house loans.
How to Get Pre-Approval in Bank Financing
Communicate with your creditor to check your financial facts and get a loan estimate before asking for preapproval on a mortgage. Let's go through these important factors in getting a mortgage preapproval as well as final loan approval and go over what your responsibilities will be.
1. Show proof of a reliable source of income
No financial institution or mortgage lenders are going to provide credit to you if you can't prove that you have a stable income. Lenders will be wary if they see that your income is inconsistent since they will have less faith in your ability to repay the loan without solid work.
Your loan payments ability in a timely manner and without jeopardizing your lifestyle or basic needs is a primary concern for lenders, so they'll look at not only whether you have a steady source of income like a salary, business profits, or freelance work, but also how much of that income you bring in.
Before applying for pre-approval, make sure you've been at your current employment for at least two years and have a solid professional foundation. Independent contractors and business owners alike are expected to meet the same job tenure requirement.
2. Own a sufficient amount of savings
Before looking at buying a home in the Philippines, you should have a solid emergency fund set up. Due to the high expense of health care for the typical person, it might be too expensive to cover emergencies, especially ones affecting health.
To avoid having to dip into your housing loan down payment in the event of an emergency, it is wise to have a savings or emergency fund established before placing a down payment on a property for sale in the Philippines.
3. Remember to take your credit report into account
Lenders in the Philippines use a variety of credit scoring techniques to arrive at varying credit score estimates for their customers. As well, the sort of loan you're applying for might affect your credit score.
Basic information about you, like your name, SSS/GSIS numbers, TIN, job details, address employer information, debt-to-income ratio, and business, may be found in your credit report. Subscriptions to utilities, loan agreements with financial institutions, and other obligations that the CIC is allowed to collect are also included in the credit report.
Creditors and service providers may use this data to make informed lending decisions for personal loan or housing loan application. Customers with a history of timely payments will be given preferential treatment, including access to additional services and reduced interest rates.
4. Check out the bank's requirements and policies
The fine print of any bank you're thinking of doing business with should be studied carefully to prevent any unwelcome surprises. Borrowers may have to give the bank permission to put a lien on collateral at the time the loan is granted. The bank may take your property and sell it to cover the loan it lost if you don't pay it back.
Therefore, it is beneficial to understand the bank's loan approval standards. Financial institutions take your age into account when considering whether or not to lend money to you. For banks, the prime lending age is between 30 and 50, when borrowers are often well into their professions. They have worked for a while and have plenty of time to pay off the monthly mortgage payment.
5. Raise your down payment costs
Taking out fewer loans reduces future financial obligations. You may use the money saved for anything else, or refinance your mortgage for a shorter period and save money.
Lenders favor borrowers who take out smaller mortgages on properties because the lender has a better chance of making a profit during a foreclosure sale. In fact, the lender may threaten to foreclose and take back your down payment if you fail to keep up with payments.
Achieve House Goals with the Flexible Payment Scheme of Lumina Homes
The idea of owning a home and a piece of land where one may feel completely safe and secure is one shared by almost all humans. The right home awaits, but you should take stock of your finances before you begin your search.
Increase your chance of getting a house and lot in the Philippines investment by purchasing your dream home from a community provider that offers flexible payment methods like Lumina Homes.
With its over 50 projects nationwide, Lumina Homes provide more versatile ways for every Filipino in achieving an affordable house and lot investment either through bank financing or in-house financing.
On top of that, you can also enjoy a better and smoother homebuying process. When you avail of our affordable house and lot for sale, an admin officer will keep in touch with you and assist you all throughout your homebuying journey. They will even help you out in applying for a bank home loan or any of your preferred financing schemes.
Choose convenience and a stress-free homebuying process with Lumina Homes!
Try Lumina Homes' loan calculator and get an estimate computation for your preferred Lumina property and home model.