What is Home Loan? Flashcards
What is Home Loan?
The <a>home loan</a> is simply a loan offered to the borrower to buy residential property that is commonly used as the borrower’s home or as a property investment.
When a lender offers a home loan, they charge an interest rate, and you only become owner of the house after you repay the loan completely. In any default case, the lender holds the right to take possession of your home.
How long does it take to approve a home loan?
When the lender receives your loan application, it can take anywhere from four hours to two weeks for them to complete the pre-approval. The property valuation can take from one day to one week, as well as the formal approval.
How do I guarantee a home loan approval?
Getting Your Mortgage Loan Approved
Know Your Credit Score. It literally takes a few minutes to pull your credit report and order your credit score.
Save Your Cash.
Stay at Your Job.
Pay Down Debt and Avoid New Debt.
Get pre-approval for a Mortgage.
Know What You Can Afford.
Should I get prequalified or preapproved?
A pre-qualification is a good way to get an estimate of how much home you can afford, and a pre-approval takes it one step further by verifying the financial information you submit to get a more accurate amount.
How can I increase my borrowing power?
You should consider changing your circumstances so you can qualify for a larger loan if you can’t borrow a desired amount.
- Cancel your credit cards
- Switch your current loans to interest only (acceptable to some lenders)
- Fix the rate on your current loans (acceptable to some lenders)
- Choose a lender that can include overtime, bonus and other income
- Choose a lender that allows you to borrow more
