Buying a home doesn't have to be stressful if you have a solid plan that's going to set you up for success. I always suggest to get with a mortgage lender or financial consultant to talk about your specific, unique situation. With a professional, you can get some solid advice on where you should start; but today - I'm going to give you some general tips on ways to prepare before you turn in your mortgage application.
Be sure that you are paying your rent in an easily trackable way. Cash, Venmo, Apple Pay, Money order - all of these ways can be very difficult to track when your file is being reviewed. Prepare for home ownership by paying via check, or some other traceable way so that the lenders can see your payments on your account statements. You want them to see how much you are paying and that you are paying on time every month. This builds confidence in your file that you will make your mortgage payment each month.
We are going to want to look at all of your savings, 401K, etc statements so we can see how you manage your money. Keep these statements clean with no weird or crazy deposits within the last 6 month. Anything that looks abnormal, we are going to ask about and need details to trace where that income came from. This goes for large cash deposits, gifts, etc.
So you decided to deposit the cash savings you keep in your home safe and you have no way to trace it. You need to leave that money in your account for at least 6 months so you "season" the money. This way, you lose the need to have to go through mountains of paperwork to explain where the sudden cash deposit came from.
Just don't do it. We can see a years tally of all of your overdrafts and NSFs on the last page of your bank statement. These can cause a loan denial - so just avoid allowing these to happen in your accounts at all costs.
Every year an average of 21 million people apply for mortgages in the US, and only around 7 million close. I'm on a mission is to change that by spreading mortgage education. Sign up for my newsletter to be a part of my Mortgage Peace Movement!