When you are at the start of the home buying process, you will be faced with the prospect of applying for a mortgage loan to finance your purchase. You cannot usually make payments to the homeowner. Unless there are specific circumstances where they let you do this type of seller-financed home purchase, a mortgage loan is going to be your key to home ownership. To help you make your home purchase a reality, here are some recommendations to help you with an upcoming home mortgage application process.

Improve Your Credit

Before you actively start shopping around for a mortgage loan, it is best if you have at least a good idea of your credit's condition. This means what type of credit score you have, what your debt-to-income ratio is, and what types of credit history are showing on your file, including the amount of unsecured debt and installment loans. If you have ever paid late or gotten behind on your payments with a loan, or if you have stopped paying altogether, these are most likely showing on your credit report.

Get a copy of your credit report from each of the three credit bureau companies to review their file on your credit history. You can request one for free from each company, which will provide you with the full report of all your history. Look for errors or discrepancies and dispute them if you find any. You want your credit file to be accurate but also good. Therefore, if there is any bad credit history, work on paying it off, making payments on time, and reducing your unsecured debt. Your mortgage lender can also talk to you about your credit file and recommend some changes to make based on their credit criteria for obtaining a mortgage loan.

Shop For a Loan

Once you have your credit in good condition, you can start shopping for a mortgage loan. Mortgage interest rates have been at all-time lows recently, which makes your mortgage payment more affordable. However, you can shop around for different loan programs and interest rates based on the funding available. When you are shopping for a loan, each credit inquiry will show up on your credit file but will not lower your credit score as it would if you apply for a new loan each month. Because you are applying all within a certain period of time, the credit bureau considers this and it does not negatively affect your credit score. 

Look into a loan program that provides you with the right repayment options for your financial situation. There are adjustable rate loans, low down payment loans, and loans for a 30- or 40-year repayment.

Contact mortgage lenders in your area to learn more.