Pay Down Debt and Build Credit
The very first step to the process is making sure that your credit is in order. Get a copy of your credit report and find out what your credit score is as well. In California the ideal credit score to have when getting started is at least a 740. Sure it's possible to secure a mortgage with a score as low as 620, but you'll pay higher interest rates with anything less than a 740 most of the time.
If you see that your score is lower than that mark, you should pay down your debt and take any other action that you can to raise your score up. If you have obvious problems on your credit report that you can take care of fixing your score should be simple, but for more complex issues you should consider working with a bank or a credit counselor to figure out how to make the biggest improvements.
Save up
While you're building your credit you should take the time to save up as much money as you can. It's common to pay a minimum of 3 percent for your down payment, another couple percent for the closing costs, and then you have legal fees, a year of homeowner's insurance and an inspector to factor in as well. All of these costs should be accounted for and you should take the time to save up enough to cover them all before you get started with a mortgage. Some banks offer savings programs and special accounts to help you come up with this money, consider relying on one of them to improve your chances of getting a mortgage and to help ensure that you have enough money in the end.
After you've taken the time to improve your credit, pay down your debt and save up money to cover the costs listed above, it's time to get in touch with mortgage companies to find out what your options are. Call up several different companies and sit down and talk with as many of them as you can to figure out who you want to work with and who will consider you as a client. Get a detailed list of your options from the different companies and find out about any changes or improvements that you need to make to your credit report in order to secure your first loan. Hop over to this website for more info.
Get Preapproved
After talking with several different providers pick the one that you like the best and supply all the documentation to get your preapproval for a mortgage. This might take you weeks or months to do depending on how much you have to provide and what you have on hand, but it's a vital step in the process. Once you get a preapproval you're clear to work with a real estate agent and start trying to find the home of your dreams.
Get started working through all these steps as soon as possible and when you finally sit down with one of those California mortgage companies you'll be more prepared to get your loan without trouble.
