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If you are a DREAMer, you must have faced financial barriers. From getting approved for a personal loan to paving your way to the college – you have undergone unique upheavals throughout your life. The same problem surfaces as you try to purchase a home. FHA-approved lenders cannot grant DACA recipients home loans since the HUD does not confer a lawful status to them. It is pretty evident how you are likely to suffer from hiccups even while applying for a mortgage.
So, how do you secure a house loan? Millennials DREAMers are keen to start the process as they finish college. While they are willing to settle into their new lives, a mortgage plays a crucial role in fulfilling their goals. If you are also going through the same situation, you would like to find out about the preparation stage. How do you prepare for the home loans for DACA recipients in Houston, TX? Let’s find out the useful tips before you apply for a DACA loan in 2020.
Larger Down Payments are Better
Resorting to the FHA loans might not have been the best option if you were going to apply for the low down payment options. Of course, you cannot apply for it, but a low down payment does not help. Given that the DACA recipients undergo financial troubles, the red flags are already visible. As a millennial, you must have thought about going for a low payment (as low as 10% at least), it would not be a feasible choice. Invest time and save for a 20% down payment. Even though people prefer putting down 6%-12%, 20% down payment is a smart choice. There is no mortgage insurance, and the mortgage rates can go down.
Take a Look at Credit Report
If you start to think about saving for a down payment, check your credit score. The credit report paints a realistic picture of how your financial condition is. The lender reviews the reports before calculating the mortgage rates. It is better if you start in the early process and find out any discrepancies. The credit score requirement for the DACA loan changes but you cannot let it affect the mortgage process. When you start at an early stage, you have the time to work on the FICO score. Check your credit rating 12-36 months before applying for a DACA mortgage application.
DACA Mortgage Pre-approval
Before applying, learn the difference between pre-qualification and pre-approval. When the pre-qualification is only about taking a cursory glance at the borrower’s ability and credit, pre-approval is more than that. Pre-approval does not take time, but it is an indication whether you qualify, Pre-qualification does not mean approval, either. Discuss the pre-approval with the lender before you decide on the price range.
During the preparation stage, you can shop around for the mortgages. Ask the mortgage rates, closing costs, and other additional charges. Looking around for the lender is also important. As a DREAMer, you are not far away from attaining the final goal.