Fannie Mae is a public listed but privately held organization that develops lending opportunities for those who need mortgages and works closely with the government. Fannie Mae buys mortgages from the lenders which are qualified rather than lending out money directly. If you wish to get a loan backed by Fannie Mae you may need to make sure that you are following these steps.
1. Collect all the information for a Fannie Mae Loan.
- You should be able to prove your employment history of minimum 2 years, below than 2 years can cause a problem such as rejection of the application. Although certain exceptions are available for disables, retired or those on social security services.
- You should be able to provide the solid evidence or your income such as salary from your job or pension, dividend or may be rental income.
- Did you ever save money? If yes then the great news is that twenty percent amount for down payment is an ideal cost of the house selling.
- Negative credit issues can put your dream of becoming a house owner in dark side unless repaired because Lenders always look at your credit history that what are your current outstanding debts and how you made your previous monthly payments. If your credit history record is good then there shouldn’t be any problem.
2. In order to qualify for a mortgage it is compulsory to calculate your debt to income ratio i.e. your income shall cover your all monthly debts including the new proposed mortgage payments. Fannie Mae has given the guidelines for DTI which states that if you exceed the limit i.e. between 28 to 36 percent you may need to bring down the figure by paying off the loan before your application shall proceed.
3. Once you are sure that you meet all the above mentioned requirements, now you have to find a lender. Check out the terms and conditions, interest rates and other miscellaneous fees associated with the borrowing the load.
4. Once you’ve selected the lender now apply for the loan with the income, employment proof documents and of course the down payment.
Tips & Warnings:
Clear up all the negative history of your credit statement before applying for a Fannie Mae Loan.
Make sure you only apply for the loan at only one institution.
Be sure about the lender before applying for a loan as the terms, interest rates and other charges may vary based on the lender.