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Perhaps you have found the home of your dreams.  Or perhaps you are about to start looking for a home.   If either of these is the case then you will need to find out if you qualify for a mortgage.  There are a few different things that play a role in qualifying.

One item that plays a major role is your credit history, and credit rating.  Lenders are going to look at a few things in regards to this.  They will look at your credit score – which will give them an idea of the risk associated with giving you a loan.  If you have a good credit score then obviously the lender will be more willing to arrange a loan for you.

The lender will also look at items on your credit history. Whether you have had any bankruptcies in the past?  Are you prone to making late payments?  Have there been any collections associated with you in the past.  All of these play a part in how the lender will view your risk.  If you do have these items on your credit history then all is not always lost if you have a viable explanation ready to present to the lender.

The lender will also look at the amount you owe on your credit cards.  If you owe a lot or indeed if they are maxed out it may create problems with your loan application.  Therefore it is in your interest to pay off as much of your credit card bills as possible before trying to qualify for a loan.

The lender will also look at the other long term monthly payments that you make and that are due in excess of eleven months into the future.  These will include items such as car loans and other types of long term loans.   Therefore the fewer amounts of these you have the better for you loan qualification.

If you are looking to qualify for a loan it is beneficial to use a mortgage calculator to help determine your mortgage and loan options.

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