With housing prices continuing to fall and credit becoming more widely available to consumers once again, it is an ideal time for those currently renting to consider purchasing a house. The benefits of home ownership, coupled with an advantageous housing market will allow many consumers to purchase their first homes and start building equity instead of paying rent to a landlord. Many consumers mistakenly think that they cannot qualify for a home loan nor afford a house due to officious terms often cited in media sources, yet with a first time buyer mortgage home ownership is available to many that have less than stellar finances.

Owning a home for the first time enables the buyer to build equity for themselves instead of paying rent and building equity for their landlord. Instead of giving someone else money every month, the equity created for the owner will open many doors for them financially in the future. An often overlooked benefit of equity accrual is the ability to consider mortgage refinancing in the future to either restructure payments or to access the cash value of such equity. Personal motivation to improve property is also rewarded in home ownership as opposed to renting, owners being able to change and improve their properties in appealing and advantageous ways that may lend themselves to higher resale values in the future.

As housing prices bottom out in the near term, the increasingly stable economic environment is going to reward new home ownership and create the most affordable housing market likely to ever be seen. Many consumers anxious to purchase a home for the first time have the mistaken impression that oft bantered “rules of thumb”, such as that 10%-20% down payments are mandatory or that their mortgage payments need to be less than one-third of their disposable income, will keep them from ownership. In reality these misgivings are unfounded and many can afford a home with a first time buyer mortgage. As opposed to many traditional mortgages, a first time buyer mortgage generally requires a 3.5% down payment and it is often still possible to qualify even if your potential mortgage payment ranges as high as 50% of your gross income.

It is often also a misconception that if a consumer has a first time buyer mortgage they will be unable to refinance in the future, which is just simply not true. With a focus on economic recovery the government is likely to keep interest rates low for the foreseeable future, allowing a potential buyer worried about high payments to build equity now and then as interest rates rise to consider mortgage refinancing in order to restructure their payments to maintain a manageable level. For those consumers worried about liquidity, mortgage refinancing will allow them to readily access their accumulated equity in the future.

Overall the benefits of purchasing a home as a first time buyer, whether they be financial or personal freedom, are staggering. The housing market is nearing its bottom with interest rates at historic lows, there has never been a better time for consumers to buy a house and take control and benefit from their biggest monthly expense. A first time home buyer mortgage can help many with that, and allow them access to something they may have been afraid was only a dream.

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About the Author:
It is often also a misconception that if a consumer has a first time buyer mortgage they will be unable for mortgage refinancing in the future, which is just simply not true.
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It is quite intimidating to apply for a new mortgage.  The process of application and approval is really uncertain.  It is also a very exciting time because you know that you could have your own home if you get an approval.  

There are numerous variables that are being considered by lenders when you apply for a mortgage loan.  This means the approval of your application primarily depends on many factors.  

One of the most important factors that lenders will always consider is your rental history.  Most applicants for mortgage loans tend to think that the approval of their loan is based solely on their credit scores and current level of income.  

You have to understand that your rental history also plays a crucial part in the approval process.  Here are some of the most important things that you need to consider when you factor rental history and how it will affect your mortgage loan application.  

Are You a Consistent Payer?

Consistency is one of the biggest factors that lenders examine when they consider your rental history.  They would want to know if you have been a consistent payer.  Specifically, lenders will examine if you have paid the rent on time every month.  

One or two late payments on your rent may not significantly affect your chances of getting an approval.  However, if you have often made late payments on your rent, then this could be a deal breaker.  Consistency in paying the rent shows that you are responsible in the past.  Lenders therefore will have more confidence in giving you a loan that requires regular monthly payments.  

History of Evictions 

Mortgage lenders also tend to examine your history of evictions.  They will demand to know everything if you have a history of eviction.  Usually, they want to know if the eviction has been caused by your payment history or some other causes.  

Do take note that mortgage lenders will probably speak with your landlord.  This is a way of verifying the reason why you have been evicted from the rental unit.  If you do not have a very good credit score and your current income falls below the acceptable standards, then a history of eviction could lead lenders to disapprove your mortgage application.  Also, a recent history of eviction has more weight than an eviction that happened some years ago.  

Credit Score 

Of course, to get a full picture of your entire history, lenders will pull your credit report.  You have to understand that a big part of your credit report pertains to your payment histories.  So if you have been a good payer, then your credit score will be very good.  This means that you are responsible enough to pay all your obligations on time.  Late payments on your obligations will certainly be reflected on your credit report. And because of these late payments, your score could be adversely affected.  

Developing a habit of making late payments is not good.  That is because your credit score will suffer.  So you have to try to develop a strong rental history in order to increase your chance of getting an approval for the mortgage loan.

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About the Author:
Rob K. Blake, home loan expert and author, educates mortgage shoppers on finding local providers by state like Nebraska Mortgage Brokers and Lenders and provides reviews of national companies like Ashwood Financial.
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Please Note... All links within articles are placed by their author-owners and not by this blog.Products with in those links may or may not be the best in the world.If it sounds too good to be true it could be a scam.Articles are posted for their info,ideas and or entertainment value only.

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