"Just because your mortgage application has been rejected once, doesn't mean you won't eventually get funding." writes Vickie Elmer for the New York Times.  

Elmer says that some borrowers succeed on the second or third attempt, "after they have saved more money for a larger down payment or improved their credit score."

Find out why you were rejected.  Were you close to getting the approval?  Ask the lender who reviewed it, to see if it's something on your credit report that you can change. "Sometimes the gap is small," writes Elmer, "and could be bridged with, say, a few thousand dollars more for the down payment, or another home appraisal."

Shop around for lenders.  "You may want to go to a mortgage broker or an online network like LendingTree or Zillow's Mortgage Marketplace." Says Elmer, " An experienced broker or banker can discuss alternative products and loans available from the Federal Housing Administration, which has less stringent requirements, though applicants may have to take out mortgage insurance if their down payment is low." And don't forget to look at your local Credit Union.

Lenders still have to compete, even in this economy but make sure you are looking at properties you can afford.  "Applicants should also look at ways to strengthen their financial picture" before they seek financing, writes Elmer. Get a copy of your Free Credit Report.  "If your FICO score, for example, is 20 or 30 points below a bank's requirement, you may be able to inch it up by paying down your credit-card balances.  Just don't use up the money you need for a down payment or closing costs."

Do your homework when looking to apply for a home loan.  Understand all available loan options and get your finances in order before filling out the paperwork.  You can even find a lender to pre-approve you for a loan, which will make shopping for an affordable home that much easier.

Read the full article at NewYorkTimes.com.

Posted in Buyer Resources, GenX GenY, Real Estate Market Conditions, Headlines

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