It's a mix of stable income, low debt to income ratios and credit score. It's important to show that your income is likely to continue with your employer (or contract) and that you have a good history of paying down debt.
Is there something self-employed folks should consider before applying?
You'll want to have at least 2 years of self employment history shown on your last two years of your taxes before applying. You will also want to be sure that if you owe taxes to the IRS, that it will be either paid or on a payment plan for at least 3 months before closing.
I always recommend to my clients to NOT purchase anything big like a car when they are thinking about getting a home loan. Is there a recommended time window?
This is a tough one, as it can depend on the situation. If the debt to income ratio is low and the credit score is high, it might not effect you much to purchase within the same year. However, if your credit scores are just above qualifying and their debt to income ratio is high, purchasing a new car will not allow you to qualify.
Tell me about programs you offer first time buyers.
We offer several programs to 1st time homebuyers, but one of our recent programs gives $1500 towards closing costs and a $2,000 Home Depot gift card at closing. It allows for as little as 3% down payment, and that down payment can be a gift from a family member.
What is different about getting a loan as an investment vs. a home?
For a primary residence (a home that you will be living in) you can have a lower down payment and credit score to qualify. For an investment property, you will need a higher down payment and the ability to show reserves to cover your primary mortgage and the investment property. Investment properties are seen as a little bit of a higher risk to lenders, so they require more assets to lower the risk.
What is the biggest misconception about the loan process?
The loan process doesn't have to be difficult. I have had buyers finish closing on a property and say "this was a lot easier than I thought it was going to be." As a lender, we want to help you in the process and will do whatever we can to keep it as easy as possible for our buyers.
Click this link to contact Brooke and apply online.