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Hello, ladies and gentlemen. Welcome

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to dollars and dwellings the podcast

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that unlocks the secret of financial success

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and homeownership. I'm your host

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Regine Etienne. and today

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we're going to talk about a topic

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for anyone. dreaming of

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owning their own piece of Real Estate.

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Getting approved. a for mortgage. So

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you found your dream home, but how

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do you turn that dream into reality?

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It starts with the mortgage. So

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today we're going to break down the key elements

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you need to secure that coveted mortgage.

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So let's get started step. Step

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one, know your credit score.

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Lenders use. That

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three digit number to. Evaluate

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your credit worthiness. The

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higher, the score, the better your chances

0:50

of approval. So if your credit.

0:53

needs a boost consider taking

0:55

steps to improve it before applying.

0:58

Well you can apply me what I do

1:00

with my borrowers. I

1:02

encourage them to apply because

1:04

my belief is that in order

1:07

to get in the game,

1:09

you need to know where you stand.

1:12

So what I do, usually I look at their credit

1:14

I do a preliminary of the credit app one

1:17

file. And then that tells me

1:19

where they stand right now. And

1:21

I, and then I give them ways

1:24

to improve the credit for

1:26

mortgage purposes, because it's not

1:29

everything that's on your credit.

1:31

That you need to pay off., We're

1:34

going to do a podcast just on credit,

1:37

but right now I want you to

1:39

know that you need to know your credit.

1:41

So go ahead. There

1:43

is an annual credit report.com

1:45

do not use, credit karma.

1:48

Credit karma is not for

1:50

mortgage. You can pull your

1:52

credit on annual credit report.com

1:55

and that will give you, from all

1:57

three bureaus. And then you'll be

2:00

able to evaluate. What

2:02

your credit is like, if you

2:04

want to do score, usually you have to pay for

2:07

it, but I don't need the score.

2:09

You know, I wouldn't need the score right now. I

2:11

would need to see what's on your credit. And that

2:13

would tell me. As far as

2:15

history. Payment

2:18

what's on your credit where you

2:20

stand so first,

2:22

know your credit. So go

2:24

to annual credit report.com and

2:27

pull your credit. So step

2:29

two it's income and employment

2:32

verification. Lenders

2:34

want to ensure that you have a stable

2:36

income to make those monthly payments.

2:39

And, and prepare to

2:41

have your pay stubs. We

2:43

asked for like one month. Worth of pay

2:45

stub. All your W2's for the past two

2:48

years. If you self-employed.

2:50

Prepare your tax returns. For

2:52

the past two years and other

2:54

income documentation that proves your

2:57

financial stability. So if

2:59

you are on social security,

3:02

that's income. If you on

3:04

disability, that income, if

3:06

you have child support, that can be used

3:08

as income, you know? They all have

3:11

their own guidelines. But it could

3:13

be used at income and annuity. You

3:15

know, all these things, we can look

3:18

at it and there's a lot of things that

3:20

can be part of your income. You

3:22

know, a good loan officer will

3:24

ask you more questions. You

3:26

know about, about things, because sometimes

3:29

you might not think it's income and it is so

3:32

believe it or not. Unemployment

3:34

can be income, if you

3:36

are someone who works a seasonal

3:39

jobs. And after,

3:41

you know, you let's say you work nine months

3:43

out of the year and. The

3:45

next three months, you do get

3:47

unemployment check. And this is something

3:50

that has been going on for at least

3:52

two years, then unemployment

3:55

can be income. Step

3:57

three. Down-payment

4:00

so saving for a down payment is

4:02

a significant milestone. Most

4:04

lender require a percentage of the

4:06

home purchase price of front. So

4:08

that's your contribution to the loan. And

4:11

the more you can put down, the more favorable

4:13

terms you'll get, because

4:15

the more you invest in yourself,

4:18

the most secure the lender

4:20

gets, because believe it or not. I

4:22

mean, most people don't understand that

4:25

it's two of you buying the house. It's

4:27

you. And the lender.

4:30

The lenders investing most of the

4:32

money. But the more you can invest

4:34

with you the more, the better the terms

4:37

That you're going to get. Cause that that's

4:39

a thing that factors into the

4:41

rate also. So how do you

4:43

save. I tell

4:46

people, um, You

4:48

know, Income is something that either

4:50

you have to create by. Doing

4:53

something. On the side. Or

4:55

you have to take side hustles or

4:58

use the talent that God gave you and

5:00

make something out of it. Or if

5:02

you do make money on our people make money, but

5:04

they spend too much. So look at your bank

5:06

statement. What do I spend

5:09

money on that I do not need to spend.

5:12

Um, one time I had

5:14

a borrower, I said that would making

5:16

a lot of money. But then we're not saving

5:19

a lot of money. And I was like, Can

5:21

I don't want to see all Ben's statement. Let's go

5:23

over your bank statement for the best. For

5:25

the past three months. So,

5:28

you know, people have to be pretty, people

5:30

have to have a life and enjoy life.

5:33

Yes. But when you have a goal

5:35

to buy home, you have to shift your

5:37

mindset. So the luxury

5:39

goods out. The eating

5:42

out every day out.

5:45

You know, Starbuck is gonna need

5:47

to turn into coffee at home,

5:49

um, or, you know, the weave

5:52

and the nails and the lashes. All

5:55

these things you might have to go with

5:57

what God gave you for awhile. You

5:59

know, and make it pretty. Uh,

6:02

so those are the things that we had to

6:04

do for her to save some money and

6:06

believe it or not. By cutting

6:08

down. She was able to

6:10

buy the house within a year. So

6:13

that's, you know, saving, there are strategies

6:15

to saving and. All

6:17

the things I'm talking about today. We

6:20

going to have a podcast just

6:22

for that to break it down. Because

6:24

it's, this is why, now this is just the surface.

6:27

There's so much. That goes

6:29

into each one of those, you

6:31

know, steps, key elements of buying

6:33

a house. And then step four

6:35

days, the debt to income

6:38

ratio. So the lender,

6:40

we look at your debt in

6:42

relation to your income. So

6:45

we tell all borrowers,

6:47

you have to keep your ratio as low as

6:49

possible by paying down existing

6:52

debt. And this way it shows

6:54

the lenders that you know how

6:56

to manage additional financial

6:59

responsibilities. It

7:01

is by your habit on

7:03

credit that a lender knows you. They

7:06

do not know you. you know,

7:08

from Adam and Eve, so

7:10

they know you on paper, they

7:12

know you through your bank statement. They know

7:14

you by how you work your job.

7:17

They get to know you. through how

7:19

you pay things on your credit. So,

7:22

this is a way where a lender

7:24

can objectively. Learn

7:27

of someone's character. Because

7:29

we can't get to know everyone, you know, I can't

7:32

be a friend, you know, even when I'm doing.

7:34

Your mortgage. I I, as

7:36

much as I love you, I'm I'm

7:39

your friend. You're my, you're my best friend.

7:41

I have to judge you by what is paper.

7:44

So. manage.

7:46

Debt to income ratio, right? So it is

7:48

how much of your income.

7:51

Or you using to pay your debt?

7:54

Some people make a hundred

7:56

thousand, $200,000

7:59

a year. And they cannot

8:01

buy a house. Because they have so

8:03

much back in end debt

8:06

that's on there. Credit that they are paying.

8:08

The car. The

8:11

line of credit, the, all the credit

8:13

cards, the. The vacation,

8:16

um, you know, timeshare. You

8:19

know, all these things go into

8:21

your debt to income ratio.

8:24

They would call it back end ratio. Sure. That's

8:26

that's not something that's related to the house

8:29

that you paying, but it's something that's related

8:31

to your debt.

8:33

That's on your credit report. So that's

8:35

called back end ratio

8:38

so for. Uh, for example,

8:41

46%. I'm

8:44

like nine, nine of your income.

8:47

Is what we allocate

8:49

to pay your house.

8:52

So that's for the FHA

8:54

loan, conventional loans have

8:56

a different ratio. It's 50. It's

8:59

50. So that means

9:01

that if you're making a hundred dollars,

9:04

W convened conventional

9:06

stage, you can only use $50

9:09

to pay your, all your debt. Alright,

9:13

all your debt together. So

9:15

they give you a limit. They make a budget

9:18

for you. That's why some people can

9:20

pay. All right. But they cannot pay

9:22

a mortgage because. Rent

9:26

do not factor your debt

9:28

to income ratio, but mortgage

9:30

does. So they do have a budget

9:32

that deep for you that they have to, um,

9:35

abide by. So

9:38

it is, you have to be mindful of

9:40

what how you spend your

9:42

money and how you use your

9:45

debt. So debt to income

9:47

ratio is very important. That's

9:49

one of the factors that a lot of time

9:52

make somebody do not qualify. It's

9:54

not that you're not making money. It

9:57

is that you are spending too much

9:59

money. Paying down

10:01

debt. Um, so.

10:04

Be mindful of that. So we'll, we'll

10:06

w I. I I'll show you what

10:08

it looks like as well. Cause I'm going to make

10:10

videos. That you know,

10:13

where I show you visually.

10:15

Are you going to see my face? You're going to see

10:17

slides. And I'm going to show you visually

10:20

of what it looks like. So look. Uh,

10:22

on our Facebook, um,

10:25

and Instagram and, you know,

10:27

social media pages. And you'll

10:29

be able to see those as well. And I'll

10:31

do some podcasts that are video, um,

10:33

that'll video as well. So you guys

10:35

can meet me in person

10:37

and see and see what,

10:40

um, what I'm talking about visually.

10:43

And also you have. The

10:45

step four. That's

10:47

step five, step five. You have to choose the

10:49

right mortgage. There are many mortgage

10:52

options. There is the

10:54

FHA loan. There

10:56

is the conventional loan

10:59

within conventional we have HomeReady

11:01

and home possible. You can take

11:03

a loan and within the loan, you can

11:05

also fix your house. There is

11:08

VA loan USDA loan.

11:10

So there's all top of loan,

11:12

programs to help a borrower.

11:15

And it's, uh, it's the job

11:18

of all loan officers to

11:20

tell to. You know, to guide you as

11:22

to which are better for you, they have to give

11:24

you a choice. So understanding

11:26

the differences will help you select

11:28

the loan that aligns with your financial

11:30

goals. So step six So before

11:33

you can go house hunting.

11:36

It's good to have a pre-approval

11:38

letter. This is the letter that tells

11:40

you. Okay. Well, based

11:43

on what we see right now, this

11:45

is what you can do. Um,

11:47

and it depends on the

11:49

area too, because every single

11:52

house, every single house have their

11:54

own. Tax their

11:56

own, you know, homeowners insurance.

11:59

No nothing is, is cookie cutter

12:01

in mortgage. So that's

12:03

why I tell people do

12:05

not listen to what other people tell

12:07

you because your mortgage

12:10

is very, very personal.

12:13

It is not because someone

12:15

has a, this mortgage went

12:17

through this experience that you're going

12:19

to go through the same thing. Mortgage

12:22

rules or not cookie cutters.

12:24

We have guidelines that we have to

12:27

go by. But a good loan officer

12:29

like me, we know how to.

12:32

Navigate through the guidelines and get

12:34

you home. It's crucial to consult

12:37

a mortgage loan, professional for personalized

12:40

advice. Because, like I said,

12:43

Mortgage is very, very personal.

12:46

It is not your mother's mortgage.

12:49

It is not your cousin who just bought a house.

12:51

It's your mortgage. It's your

12:53

circumstances. Because

12:56

no, you don't need to be working two

12:58

years to buy a house. The minimum

13:00

is six months. We'll go over those things.

13:03

When I talk about. Income.

13:05

When I delve deeper into

13:07

what income and what type of income

13:10

and how we calculate the income. So,

13:13

yeah, so this is today's. So

13:15

this is what we got, we, we talked about.

13:17

So the key elements

13:19

of a pre approval is credit.

13:22

know, your credit. It's income.

13:25

So save those pay stubs. I know

13:27

that, you know, technology, nobody

13:29

really would look at their pay stubs anymore. They

13:32

know they get paid. It's good to look

13:34

at your pay stub. Because, we

13:36

see a lot of things in a

13:38

pay stub. So save

13:40

your W2's for the past two years

13:42

if you are self-employed or if you

13:44

have a house that you're renting,

13:47

if you have. Other income

13:49

that goes into your tax

13:51

returns, save all pages

13:54

of your tax returns. Save your

13:56

business tax returns. If

13:58

you're on social security, we

14:00

want to see your award letter.

14:03

If you there is child support, save

14:05

those child support papers

14:07

from the court we don't want it.

14:10

Verbally, we need paperwork save

14:12

all that. So, um,

14:15

we look at downpayment saving,

14:18

Debt to income ratio. We analyze

14:20

the data and we tell you what your debt

14:22

to income ratio. We always do. Is,

14:24

does it fit if it doesn't fit? Always

14:26

to make it fit. We'll tell you. And

14:30

also choose the right mortgage type.

14:32

Because not every, some mortgage

14:35

required the we present. You

14:38

can get all conventional alone. At

14:40

3%. It's possible. We

14:42

will tell you what's available

14:45

based on what we see

14:47

when we do the analysis. But

14:49

it's good to learn. It's good for you

14:52

to know. So you can know, is, is

14:54

the mortgage loan officer giving me the right

14:56

information. It's also good

14:58

to shop around. I want

15:01

to teach you guys how

15:04

to get in a position to get

15:06

a mortgage and to know when somebody

15:09

is giving you the right information.

15:12

And I want to encourage you to also

15:14

go look up these things for yourself

15:17

keep your credit. If you want to get

15:19

the best rate. the best rate somebody

15:22

can have with the 740

15:24

credit score can be one thing

15:27

one day and tomorrow is a different thing.

15:29

Same thing for somebody who

15:31

has a 580 credit. I hope

15:33

that I was clear,

15:36

but if you have any questions, feel free to

15:38

call me. My number

15:40

is available. I

15:42

find don't answer. I do leave

15:44

a message. And my email address

15:46

as well. You can send me a message

15:49

and I'll do my best to return

15:51

it in a timely manner. But I

15:53

will return it. If I do get

15:55

the message. So, um,

15:58

so thank you for tuning in today for dollars

16:00

and dwelling, and we hope this episode

16:03

brings you one step closer to

16:05

unlocking the door to your dream home.

16:07

And join us next time for more insight

16:10

into the world of finance and home ownership.

16:12

Until then this is Regine your

16:14

host. Signing off. See

16:16

you next time on dollars in

16:19

dwellings. Have a blessed day.