Increase Your Chances for Approval

There are a few ways to increase your chances for loan approval that will also help you determine what you will be able to afford each month:

Ask for only the amount you will need

One way to increase your chances for a home loan is to not ask for more than you will qualify for. Look at your income level, the amount of debt you have, and calculate your cost-of-living expenses (utilities, food, transportation). The expected monthly mortgage payment should not be greater than the amount of money you have left each month after expenses.

Pay off credit card balances

If you are thinking about buying a home in the next few years, start paying off those credit cards and only use them for emergencies. Do not cancel your existing cards since this may lower your credit score. By showing you have a zero balance on your credit cards, you will be showing lenders that you know how to use credit wisely and you have been paying your bills on time.

Always pay bills on time

This includes your electric bill, rent, student loans, and other bills that you may have to pay each month. By creating a track record that can be traced, you will be showing lenders that you are a responsible person who deserves to have a home loan.