Greater Central Texas Federal Credit Union,
3305 E Elms Road
Killeen, TX 76542
Telephone: 254-690-2274
www.gctfcu.net

Steps To Applying For A Home Loan

17. March 2017 Administrator Home Loans (0)
A credit union is a non-profit cooperative that provides home loans at low interest rates to its members. The organization aims at passing on the profits to the members and therefore adds a lot to their savings. It is important to be clear about the home loan requirements so that you can easily purchase the home of your dreams.

Below are some steps that you need to follow while applying for a home loan:

  • Get pre-approval: In simple terms, pre-approval is a written application that states how much amount the lender will let you borrow. This document is necessary so that you know exactly how much you can borrow and how much money you need to put from your side. This will help you divide your budget according to the monthly expenses. Various factors such as employment history, credit score, down payment etc. are taken into account while pre-approving a home loan.
  • Make the offer: After zeroing down a particular property, you need to prepare an offer in consultation with your real estate agent. Offer contains details such as purchase price, closing date and the time period for which the offer holds good for you. This is given to the seller who can accept or reject it. If your offer is accepted, you need to get home inspection done from a qualified professional. 
  • Complete the loan application: After coming to a conclusion regarding the price, you need to complete the loan application formalities. The lender will determine the terms and conditions of your loan, ask you to complete the loan documents and may also demand additional documents. These can include: pay stubs for the past few months and tax return details etc.
  • Get the interest rate locked: Locking the interest rate with your lender ensures that it does not go up while your loan is still getting processed. This is imperative because home loan interest rates can fluctuate on a daily basis and you would want the lowest interest rates for big financial savings.
  • Go through loan processing: In this step, your home will be evaluated to judge its market value. Apart from this, the lender will review your loan application, cross-check the documents, verify the financial information and also check the title details to ensure that all the legalities are in place.
  • Closing: During the last stage, your home loan documents will be sent to a title company so that you and the seller can duly sign them. A photo identity proof along with the down payment amount is required for closing. Apart from this, many other documents such as loan note and deed etc. need to be reviewed and signed.
We, at Greater Central Texas Federal Credit Union offer affordable financing services in Killeen, TX.  To know more about our credit union, call us at (254) 690 – 2274.
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GCTFCU Blog | Applying For A Home Loan? Questions Your Lender May Ask
Greater Central Texas Federal Credit Union,
3305 E Elms Road
Killeen, TX 76542
Telephone: 254-690-2274
www.gctfcu.net

Applying For A Home Loan? Questions Your Lender May Ask

17. November 2016 Administrator Home Loans (0)
Getting a home loan is expected to be an extensive process as the lender may ask some important questions from the borrower. This may be done to clear any doubts regarding your financial stability. You need to be prepared with all the paperwork and documents at the origination of the loan-approval process. Following is a list of questions a lender may ask before approving your home loan:

Q: How much do you earn?
The lender may ask for the recent pay stubs in order to secure a fairer idea of your monthly income. The debt-to-income ratio has to be conducive for you to secure the desired amount of loan at a reasonable rate of interest. Having a stable job with a steady income reduces a number of hassles for you. In case you own a business or have recently changed your job you may need to produce your tax returns. Asking for your income tax returns can imply two important causes. One, the lender wishes to look at your annual revenue. In case you have provided with a record of past few years, the lender will get a fair idea if your revenue has increased or remained constant over the years. This is good because it increases your credit worthiness.

Q: What is your source of income?
The lender would want to be sure about your job stability. Providing details about your employer can help the lender get a better idea about your income consistency. If you are self-employed, it is necessary to make sure your business is profitable. The lender may ask for at least two years of income records. In case you are planning to pay the loan from your savings or you will be using a grant/gift from your relatives, you may be required to produce the gift letters as proof.

Q: Do you have any current debts?
This question is generally asked to get an idea about your financial liabilities and ensure that you will be able to repay the loan. Sometimes, the lender may ask you to produce documents which state that you have paid all of the previous debts. In case you have an active debt, the lender may want to make sure that your income allows you to take another loan.

Q: What is your marital status?
If you plan to pay your debt through the alimony, the lender will need assurance that you will receive the amount. Women receiving money from their ex-husbands may need to produce the papers that state their legal separation.

Q: What is your credit history?
The lending institution may want to know your credit history in order to make sure you pay your bills on time. This also gives the lender a fair idea of your creditworthiness and the way you manage your expenses. Having a high credit score increases your chances of securing loan at a lower rate of interest.

Q: How much savings do you have?
Many people plan to make the loan payments through their savings. Having sufficient savings in the bank is appealing for the lender because it shows your liquidity and ability to pay the mortgages smoothly. A savings account acts as an asset for a borrower and increases the chances of getting a loan approval.

Q: What is the limit of your down payment?
The down payment is a major factor determining the amount of the monthly installments. This in turn decides the duration of loan payments and the money you save. If you pay a higher down payment, lesser will be your loan tenure and monthly installments. An added benefit is that you may secure the loan at a lower rate.

If you are looking for affordable home or auto loan in Killeen, TX, consider Greater Central Texas Federal Credit Union. We offer a wide range of loan plans at low interest rates and easy repayment options. For more information, you can call us at (254) 690 – 2274.
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