Qualifying for a mortgage

While you save for a down payment and entertain yourself by scanning real estate listings, you should start thinking about whether you’ll qualify for a mortgage.

Getting a mortgage depends on many factors. First, your credit history and credit score will play a large role. So it’s smart to clear up any problems and pay off small loans and credit card debt now, at least six months before you start applying for mortgages. And naturally, paying all your other bills on time is essential. The stronger your credit history and the higher your score, the better your chance of qualifying for a mortgage, especially at a favorable interest rate.

Next, consider your employment history and your financial background. Have you been at your job for a while? You may be young, but a solid job history and steadily increasing income speaks volumes to mortgage lenders. On the other hand, if you’re just starting out or you’ve had a spotty job history, you may find it somewhat harder to qualify for a mortgage. After all, a mortgage company wants to be sure you’re still going to have a job in six months or a year.