Planning for a Bright, Financial Future

Getting a mortgage can be very exciting. Many people look forward to the day when they will be able to purchase their first home. But what they may not realize is that purchasing a home is much more involved than what you may think. In fact, you may not get approved for a mortgage and wonder why you are having such a hard time. Here are some reasons why you might not be getting approved for a mortgage.

1. You Haven't Been Working Long Enough

Assume that you just graduated college and haven't had a job for years. In fact, the only thing on your work history is maybe some summer odd jobs. This is fine because everyone has to start somewhere, but it may not be great for trying to get a mortgage. If you have barely started a job and want to get into the major commitment of a mortgage, they lender may want to see more work history to make sure that you can complete the job and be a dependable employee before they loan you a large amount of money. This is why many times the lender would like to see that you are in the industry of your job for a couple years before they give a loan. During that time you may have to rent, until you can prove that your job is stable.

2. You Have Too Many Separate Incomes

Assume that you don't have one job that is from 9-5. Instead, you have a lot of different jobs and contracts that contribute to your income. In this case you would be considered somewhat self-employed or a freelance employee. In this case, your work is not viewed as stable income and can be harder to prove. This is why they will want to see you doing these jobs for multiple years before they give you a loan.

3. You Don't Have Rental History

Having rental history can really help your chances at getting a mortgage. When you have your name under utilities like sewer, gas, and electric, it will show up on your credit report and can show that you are consistent about paying your bills. In addition, your past landlords can act as a reference to show that you make payments on time and in full. If you have been living with family and have no rental history on your credit report, it may be hard to prove that you are a good risk.

As you can see, history plays an important part in getting a home loan, so you should start talking to lenders like Dave Schell at Guaranteed Rate Mortgage early to figure out what you need, so you can start now to work towards getting that home loan.