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By Diego Arteaga, Sr. Mortgage Loan Officer

Most people plan to buy a house at some point in their life, but how will you know if you are ready? If you do not have enough cash on hand to buy a house, you are going to need a mortgage. Are you ready to get a mortgage? Here are four questions to ask yourself:

Do I have a good credit score?

Having a good credit score will make getting a mortgage much easier. Having a strong credit score shows your willingness and likeliness to pay the mortgage. Therefore, it’s much easier for a financial institution to approve the mortgage loan. In addition, having a strong credit score will give you access to lower payments, lower rates and better programs. However, you can still be approved for a mortgage if your credit score is less than perfect. FHA mortgages are normally more forgiving when it comes to a credit score, and they might approve your mortgage even though your score isn’t where you want it to be.

Do I have a steady job?

Having a secure job or a strong employment history can also help you become a homeowner. Financial institutions will need to see that your job is steady and can back the payments of your mortgage. Therefore, the longer you have been at a job, the safer you are in the eyes of a financial institution. On the other hand, if you have gaps of employment, multiple jobs in a year or declining wages, the less likely you are to be a candidate for a mortgage.

Do I have savings for a down payment?

Down payments tend to be one of the biggest concerns for first-time homebuyers. Having a healthy amount of money saved can make getting a mortgage much easier and it will open the doors for multiple programs. It will also make your payments lower. The larger the down payment, the lower your mortgage payment will be. Although it is recommended to have money saved for closing costs and a down payment, there are mortgage programs that do not require a down payment, like a VA loan or a USDA loan. There are also federal and state programs that have down payment assistance for a specific population and ZIP code. One of the most popular programs in Michigan is MHSDA. This program helps you with up to $7,500 in down payment assistance that can be applied towards a down payment, prepaids and closing costs.

Is it the right time in my life to buy a house?

Even if you are financially ready to get a mortgage, it is also important that your goals in life are aligned. Am I moving any time soon? Am I starting a new business? Am I starting a family soon? These are situations that can bring large expenses to your life and make it it difficult to make your mortgage payments.

Having these questions in mind will help remove some of the stress and uncertainty about considering home ownership. While it’s exciting to start the quest of a new home, it is important to have as much information about the situation as you can to keep you educated about what you really want and how much you can actually afford.

If you feel confident after answering these four questions, then it may be time to get pre-approved, find a realtor, and visit homes for sale.

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