Easier to get mortgage approved

(The Money Pros) - It may be easier than you think to secure a mortgage. On this week’s episode, Stephen Tetzner, founding partner of Homestar Mortgage, discussed how lending standards have relaxed since the financial debacle of 2008.

While the national media may continue to tout the gloom and doom of the mortgage industry, there are many financing options available to those who qualify. Rhode Island property values have leveled off from their historic decline.

The only real change is that those individuals who should not have qualified in the first place for a mortgage due to insufficient income verification are, today, unable to acquire a mortgage.

However, if the borrower can verify that their income can support the mortgage payment and they have decent credit, financing is available to them. Currently, Homestar Mortgage is granting FHA loans with credit scores in the low-600s.

Jumbo loans (typically mortgages greater than $417,000), which used to require a 20% down payment, can now be accessed for as little as 5% down. Financing for a condominium purchase can now be secured for as little as 3% down versus 10%. Additionally, construction loans, historically more difficult to obtain, are now being granted for a low 10% down payment.

When applying for a mortgage, be prepared to provide the following:

• 2 years complete tax returns
• 2 years of W2’s
• 2 months of assets statements from bank and brokerage accounts
• 2 most recent pay stubs
• Current mortgage statement if refinancing
• Divorce decree (if applicable)
• 12 months of cancelled rent checks (if applicable)
• Copy of purchase and sales agreement (for new home purchase)
• Declaration page of homeowners insurance if refinancing
• Drivers License
• Proof of down payment