Are you already approved for a mortgage but you need more buying power? Did they
give you a loan amount but it's just like not enough to get the house that
you want? You want a better house or a better neighborhood or you just need a
little bit more than what they gave you. Well, I've been in that same situation
and I used to work in the mortgage industry. So, I'm going to tell you some very,
very important secrets. Let's go.
Okay. So, we're talking about buying a home and the mortgage process. So, when
we're talking about getting approved for a higher loan amount, essentially, you're
trying to buy more home. In many cases, when you go to your mortgage company, you
get what's called a pre-approval or a pre-qualification. They will look at your
income and your credit. And based on basically those 2 things, those usually
are what determines what the loan amount that they're going to approve you for.
The mortgage lender initially looked at your credit report and they added up all
of the debts on your credit report, okay? Those are your liabilities. And then they
looked at your income. They looked at how much money you were making per week, per
bi-weekly, per month and they came up with what was called your gross monthly
income. Then they did a calculation where they divided your debts with the new
proposed mortgage, okay? So again, they kind of estimate what your mortgage
payment will be, what the taxes and the insurance will be. They do an estimate
and then they add to that estimate, the new proposed payment all of the debts
that you already have and then they divide it by the amount of gross monthly
income you have. And you have to have about 40% debt ratio on average. So,
about half of what you make should still be available on your gross income. And
that is what they base their decision on. And they tell you go ahead and shop for
a house because this is how much they think that you can afford. Now, if you are
in a situation where you feel like you can afford more, let's talk about how we
get there. So, like I said, I'm going to tell you the five ways. And I'm going to start
with the most difficult to the easiest. The number one way to do it... And this is
the hardest way though is to raise your credit score. Now, depending on who you
are and what your credit situation is, this may not be very difficult for you.
This could be as easy as paying off some of your credit cards or taking your name
off of some authorized user accounts that you're on. So, what you can do in
many cases is get some of those items removed or take off accounts that you
are not on you're just an authorized user on. So, most of the time when you got
approved for your mortgage, okay? And they pre-approved you and again using our
example they said 200,000. They base that off
what your credit score is right now. And so, if you want to get a higher loan
amount, you can literally start working on your credit. You can say, "Okay. You know what? I'm
not buying a house right now because I need to get my credit score up. And I'm
going to go back and do this process again." And so, you can raise your credit score
and then reapply with maybe a different lender if the credit has expired. Because
you can't just do this in 10 days or things like that unless you do it with
the same lender. If you want to get more home and you're like I can get my credit
score up, go ahead and do that. You can actually cancel the application or you
can wait we're working on your credit get your credit score up and then
reapply. And in many cases, you can get approved for a higher loan amount.
Because in many cases, what will happen is you will then qualify for more things.
There's tons of different things that is available to you if you have a higher
credit score. Number 2... And again, we're getting a little bit easier here. You can
get what's called an ARM. It stands for adjustable rate mortgage.
When you get a mortgage loan, you can have either a fixed-rate, that's the rate
for the duration of the entire mortgage. So right now, rates are super low. And we
expect that they're going to be for a long time. They've actually been
historically low for the past 10 years. And now, they're even lower. So, if you can
get an ARM in many cases, the rate will be even lower, okay? And then you can
qualify for more home. There is a warning I want to give you because it is an arm,
meaning it does adjust after the fixed period. With a fixed-rate mortgage for
the whole 30-year mortgage, the rate is the same. So, if you get a 4%, it's 4% for
the whole 30 years. But if you get an arm, it may be 1% or 2% for
3 years or 5 years or 7 years. And then it will start to adjust. So, it
is in many cases still fixed for a certain amount of time. Again, you will
know exactly how long it is fixed. And then it will start to adjust. But again,
this is a simple solution to get more mortgage loans. So, if you want to get a
higher loan amount approved, you can ask your lender for an arm and in many cases
the rate is lower so you can get approved for more money. Number 3,
adding a co-borrower. I know people are like, "Wait, I don't have
a co-borrower. I don't want.. I don't want to roommate. I don't want a person living
with me." Well, you do not have to have a person that lives with you to be a
co-borrower or on your mortgage in many cases. In fact, I'm going to share a secret. I
actually even have my certification to underwrite federal loans, okay? And this
is super secret certification that very few mortgage underwriters have.
I actually have mine. So, I can even underwrite FHA loans and VA loans and
things like that. So, I'm telling you really honestly that adding a non
occupant co-borrower, again, someone that doesn't live in the home is a
possibility on most loans. And this will increase your buying power because they
will add in that person's income. So, if you have someone that has decent credit,
a mom, a dad, an aunt, an uncle, things like that. Someone that you trust you can ask
around. In many cases, you can even work out a deal with them where they're on
the title. If you feel like you know you want to give them some some some skin in
the game where they have some ownership in the property, you can even add them to
the title of the property and they can be on the title of your home as well
until you get your situation fixed. And that way you can get more property.
Number 4, have compensating factors. And that is a factor that gives you
compensation to go higher on your debt ratio. And like I said, "Most lenders are
looking for around 40% as your debt ratio." If you have compensating factors,
meaning, you have been on your job a long time or you can provide rental checks to
show that you pay your rent on time. And you want to actually document that. And
they will let you go to a higher debt ratio with these compensating factors. So,
look and see and talk with your loan officer about what compensating factors
that you can use. And here's the thing, I'm telling you. A lot of the loan
officers do not even know about asking about compensating factors or going and
petitioning with the underwriter to give you a higher debt ratio based on
compensating factors. So now, you know something even loan officers don't know.
Use that to your advantage. Number 5, you can actually put more
money down, okay? So, if you want to get approved for a bigger loan, you literally
can just put down the reference. In many cases, if you put down
more money, they will actually increase the size of the loan that they will give
you. So, I'm not saying that if they give you 200,000 and you want 300,000, that
you have to come with the whole 100,000. In many cases, if you put down 10 or
20 thousand dollars more, they will give you 90 or 80 thousand dollars
more on your loan amount, okay? So, this is an awesome way to get a higher loan
amount just by putting a little bit more money down. So, what you want to do if you
are wanting a higher loan amount is you can shop lenders. If you feel like you
can get a higher loan and you feel like you are able to pay for it you can
afford more. And the lender that you are currently working with is not budging,
then you can shop for other lenders. Do not let them tell you that is going to
ruin your credit or that all of this other stuff is going to happen because
that's not true. If you are wanting different terms, better terms, higher loan
amounts, lower interest rates things like that, yes you can call around and shop at
other lenders. Especially if you already have your situation and you know what
your credit score is. You have a lot of power. Now, yes. Most of your big banks if
you were going to get approved at Bank of America and then you said, "I'm going to see
what Wells Fargo has." Well, in that case, they probably are very similar because
they are both big banks. However, if you were wanting another situation, you can
check out mortgage brokers. You can check out mortgage bankers. And yes, there is a
difference between bigger Bank. Especially if maybe you are living in an
economic area that they need to lend money in or you are going to buy a
property in an area that they need to lend money and because of economic
redevelopment. There's tons of programs out there that
are not advertised. So, shop. So, another thing that you can do if you want to get
a higher loan amount is you can pay off debt. So, installment loans, not student
loans, but installment loans that have less than 10 payments are usually
excluded from your debt ratio. So, what you can do in many cases is make sure
they're already paid off before you apply. Or if you need a higher loan
amount, you can pay those debts off. if you have less than 10 payments on an
installment loan, those debts can be excluded. And in many cases, you can pay
those debts down. You don't and have to pay them off. I would love to
meet you guys in person and teach you for 3 full days. If you are liking my
training, if you love my YouTube channel as much as I love you guys and you want
full training, I am offering 3 day trainings where you are with me all day,
small group. I show you my properties. You get a workbook. You leave my training
with a full plan on what to do and how to start making money investing in real
estate. I have students that are making 6 figures in a matter of months. And I
even now have students that have crossed over to the 7-figure wealth formula
where they now are a certified millionaire. So, if this is something that
you are wanting to do when you want to learn, please go to growyourwealth
event.com and check out our events. Grab your tickets. I would love to see you
guys in person. I would love to meet you at to the events and teach you and train
you fully with me. This is Noelle. To your success.