San Antonio Real Estate

Residential - Historic Homes - Farm/Ranch - Acreage

Saturday, October 2, 2010

Critical elements of the mortgage process: where you live

Perhaps it's with your parents.  You might be renting or already own a home.  Regardless of where you currently live, you may be asked to show that you're paying on time.

If you have a regular mortgage with a bank, it should show up on your credit report.  (Owner or privately-financed mortgages won't show up.)  You cannot obtain a mortgage if you've had any late payments with the last 12 months.  You have to show that you've had no late payments for the past 12 months.

If you're renting, you may have to give your rental history for the last 12 months.  A management company or apartment complex can sign a VOR stating what you history is.  If you were paying a landlord directly, you'll be asked to bring canceled checks to show you paid rent or perhaps bank statements showing transfers to your landlord's account.  Some people pay the landlord directly and in cash.  They have no way to show their rental history.  This is a problem when the borrower is trying to get an exception for another reason already - a debt-to-income ratio that's a little high or a credit score that's a little low.  Be sure you pay your rent in such a way that you can prove you paid.  A letter from the landlord won't be accepted.

If you lived with your parents and paid no rent, you will have to explain that as well, especially since you'll be going from no monthly payment for housing to a mortgage payment.

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