How do I know if I can get a mortgage?

How do I know if I can get a mortgage?

To determine if you can get a mortgage loan and make mortgage payments, a lender will:

• Look at your employment and credit history. The lender will want to see financial stability.
• A potential lender will look for steady employment – with a single employer for the past two years or at least employment in the same field.
• They will look at your credit history and note late payments. Lenders pay particular attention to any rent or mortgage payments that were more than 30 days past due.
• In order to qualify for a mortgage, most lenders require that you have a debt-to-income ratio of 28/36. This means that no more than 28 percent of your total monthly income (from all sources and before taxes) can go toward housing, and no more than 36 percent of your monthly income can go toward your total monthly debt (this includes your mortgage payment).
• The lender will also verify your bank account information.

Based on the type of mortgage you're interested in, lenders will obtain, or ask you to provide, some or all of the following financial documentation:

• Credit report
• Pay stubs for the past 30 days
• W-2 forms for the past two years
• Information about debt obligations, including car loans, student loans, tax liabilities, liens (including federal tax liens), bankruptcies, etc.
• Recent statements from your checking, savings, mutual fund or other accounts
• Tax returns for the past two years if you're self-employed
• Proof of any supplemental income
• Records of any negative credit accounts that have been paid off
• Records of child support or alimony