If you are in the market for a loan, you can expect that your full financial profile will be looked at. Loans can be taken for a number of reasons, but generally, people apply for one when they buy a house. Nationwide Home Loans is a Florida based mortgage lending firm that strives to be at the forefront of the mortgage lending industry.
Our team of expert lending professionals is always ready to help our customers with all their needs. To ensure top quality of service, we control the entire mortgage process from application to closing. Filling out your application and sharing all your financial information helps to get the loan approval process flow smoothly. Here are three things lenders don’t look at favorably in your application.
Anyone can have a late payment here or there. You don’t have to worry about a creditor reporting a payment that was late by just a few days. Your payment is not considered late unless it is 30 days past due. If you start getting letters and phone calls about an overdue payment, but the credit bureau still considers your credit in good standing.
However, you need to remember that while 30 days past due is not so bad, 60 days or 90 days past due can damage your credit more. And if you have a pattern of late payments, this reflects poorly on your financial management skills. It also casts a shadow on your source(s) of income. So in such cases, lenders may be wary of approving you for a loan.
Filing for bankruptcy can put a damper on your dream of buying a home. Chapter 7 bankruptcy is the most common form of consumer bankruptcy. It is a tool to resolve the overwhelming debt. It does leave a serious mark on your credit reports for 10 years. During this time period, you may find it difficult to get credit. The good news is that lenders are easing up on requirements to apply for a home loan.
For a Federal Housing Authority (FHA) loan, for example, you need to wait two years from the date of your Chapter 7 bankruptcy to qualify for this loan. A Chapter 13 bankruptcy has similar or lesser restrictions for getting a home loan. As may be expected, after a bankruptcy, you may need to meet additional requirements when applying for a home loan. Individual lenders may also impose tougher guidelines. At NHL Lending, we always try our best to help clients and mentor them so that they have a smooth loan experience.
Low credit score
Outstanding debts, overspending, late payments, and other actions as part of unwise financial living, can lead to a low credit score. This is not looked upon favorably by lenders. You can run into trouble getting a loan if your credit score is low. This is true for any type of loan, but especially for jumbo loans, the credit requirements are higher. At NHL Lending, we also offer jumbo loans in Fort Lauderdale, FL.
A credit score that is above 700 is a minimum for most purchasers, although other factors could merit a lower score. These loans also require a down payment of 20% or more. So it is essential to have a good, steady income, as well as good credit or substantial reserve assets. Some conforming mortgage programs are available to applicants with a credit score as low as 500, but for a standard jumbo loan, this score will not be sufficient to qualify. The good news, though, is that there may be some programs tailored for those with weaker credit, even though they may not be the best loan products.
These are three of the most important things that lenders would look at in your mortgage application. In addition, there may be other things that may be red flags such as bounced checks, large undocumented deposits, and other irregular financial activities that would alert the lenders. Whether your finances are in good order, or even if you have something questionable, just give NHL Lending a call today at (888) 995-6624 to see how we can help you.