Qualifying for a home loan can be a relatively easy process and should be the starting point for a home buyer. To qualify, a mortgage lender will look at a variety of information in determining if a borrower is credit worthy. The two key factors are your ability to repay a home loan and your past experience in paying off other debts.

Your ability to repay a home loan is measured by your annual income. If you are an employee this is usually reported on your form W-2 from your employer. Length of employment generally should be at least two years with the same employer or at least in the same field of employment for several years. Then your proposed monthly mortgage payments plus any other loan payments you have are divided by your current monthly income to determine your financial ability to repay. This calculation is called your debt to income ratio and is used by all mortgage lenders in determining if you can qualify for the amount of the loan you are seeking. In some cases other loan payments not related to your home loan can be excluded in the analysis of qualification with certain career programs.

Your past credit history will measure your willingness to repay the loan. A mortgage lender will obtain your credit report which will indicate how you have paid previous loans. Timely payment of past loans will help increase your credit score and late payments will lower your credit score.

Home loan qualification varies with each individual and can be tailored to the specific financial circumstances of a borrower. Many applicants that are weak in one financial area can compensate in another area. Some compensating factors could be down payment, long term employment, and professional licenses . NextHome offers career-specific options for Doctors, Nurses, Police & Fire, Teachers, Military & Veterans, Pharmacists & Dentists.