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Buying Your Home

How to Buy

Negotiating & Closing a Good Deal
[part 1][part 2][part 3][part 4][part 5]

1. Where do I get information on finding the best loan?
2. Where do I get information on mortgages?
3. Where can I get a list of mortgage brokers?
4. Where do I get information on PMI?
5. What do I do if I get turned down for a loan?
6. What are no-doc loans?
7. Can someone who is unemployed get a loan?
8. How long do bankruptcies and foreclosures stay on a credit report?
9. What is the first step when looking for a home loan?

1. Where do I get information on finding the best loan?

   For information on how to find the best home loan, check out this booklet:

   • "How to Shop for a Mortgage," by the Mortgage Bankers Association of America, 1125 15th St., N.W., Washington, DC 20005; call (202) 861-6500.

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2. Where do I get information on mortgages?

   For information on mortgages, check out the following sources for information:

   • American Bankers Association; (202) 663-5000.
   • Mortgage Bankers Association of America, 1125 15th St., N.W., Washington, DC 20005; (202) 861-6500.

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3. Where can I get a list of mortgage brokers?

   For information on mortgage brokers, contact the National Association of Mortgage Brokers at (703) 610-9009

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4. Where do I get information on PMI?

   Look for tips in "A Mortgage Insurance Guidebook," or "How to Buy a Home with a Low Down Payment," published by the Mortgage Insurance Companies of America,805 15th St., N.W., Suite 1110, Washington, DC 20005; call (202) 393-5566 to order.

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5. What do I do if I get turned down for a loan?

   Increasing numbers of loan applicants are finding ways to buy their own home despite past credit problems, a lack of a credit history or debt-to-income ratios that fall outside of traditionally acceptable ranges.

   Ask the lender for a full explanation, then appeal the decision in writing.

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6. What are no-doc loans?

   "No-doc" loans are mortgages for which lenders require very little loan documentation as long as the borrower puts down a sizable down payment, generally 25 percent or more.

   These mortgages are common among self-employed people who say they earn a certain amount of money but whose tax returns show that their earnings are much lower.

   Resources:

   • "How to Shop for a Mortgage," Mortgage Bankers Association of America, 1125 15th St., N.W., Washington, DC 20005; call (202) 861-6500.

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7. Can someone who is unemployed get a loan?

   Generally, lenders will not make loans to unemployed persons because someone without an income would seemingly have no way of making monthly mortgage payments.

   However, there are home loans for which lenders require very little loan documentation as long as the borrower puts down a sizable down payment, generally 25 percent or more. These "no-doc" loans are common among self-employed people who say they earn a certain amount of money but whose income tax returns show that their earnings are much lower.

   Borrowers should check directly with lenders when seeking a no-doc loan. If specific lenders do not offer them, ask for a referral.

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8. How long do bankruptcies and foreclosures stay on a credit report?

   Bankruptcies and foreclosures can remain on a credit report for seven to 10 years.

   Some lenders will consider an borrower earlier if they have reestablished good credit. The circumstances surrounding the bankruptcy can also influence a lender's decision. For example, if you went through a bankruptcy because your employer had financial difficulties, a lender may be more sympathetic. If, however, you went through bankruptcy because you overextended personal credit lines and lived beyond your means, the lender probably will be less inclined to be flexible.

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9. What is the first step when looking for a home loan?

   Most experts recommend that you should get prequalified for a loan first. By being prequalified, you will know exactly how much house you can afford. Almost all mortgage lenders now prequalify people, and many of them can even do it on the Internet. You also can do your own affordability calculations; most recent consumer books on home buying include steps to doing so, as do various real estate Internet sites.

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Century 21 Teramana-Westling, Inc. 4120 Sunset Blvd. Steubenville, OH 740-264-0300	All materials © CENTURY 21 Teramana-Westling, Inc. Last modified Saturday, June 14, 2008