Will I Get Approved for a Home Loan in Utah?

It’s easy to apply for a home loan — you can do it on your phone in minutes right from our website. But if you’ve never applied for a home loan before, you might be concerned about not getting approved. It’s disappointing, and it can make you leery of applying again. Integrity First Lending has some tips for you to help you improve your chances of being approved for a home loan.

Will I Get Approved for a Home Loan in Utah?

Home Loans & Credit Scores

The first thing you want to do before you apply for any type of loan is to know your credit score. There was a time when checking your credit could cost you money or even cause your score to go down, but that’s not the case anymore. You can check your credit any time. And that’s a good thing, because you’ll want to know if there is anything suspicious on your credit report that you need to address.

To stand a chance at being approved for a conventional loan, you should have a credit score of at least 620. For an FHA loan, your credit score should be at least 580.

Keep in mind these are minimums. The higher your credit score is, the better your chance of approval, and the lower the interest rate your mortgage lender will be able to offer you.

Boosting Your Credit Score

There are a few things you can do to improve your credit score — besides making all your payments on time and in full.

This may seem ironic, but if you haven’t made many payments of any kind — if you’ve never had a car loan or a student loan, for instance — this could work against you because on-time payments boost your credit. If there is little data on your credit report, you may want to think about establishing more of a credit history.

If you do have credit cards and you make the payments on time, that’s good, but carrying high balances hurts your credit (and costs you big time in interest charges). To be considered on solid financial ground, you should keep your credit card balances under 30% of your limit for each.

Even if you have no balances, having lots of open credit card accounts can work against you too. That’s because if you have $50,000 in available credit, your mortgage lender knows that you can rack up a debt for this amount at any time, which can impact your ability to pay your mortgage, and they won’t want to take the risk.

Other Factors Impacting Home Loan Approval

For the purposes of applying for a mortgage, a high debt-to-income ratio also impacts you negatively, even if your credit score is good. You may make all your payments in full and on time, but if you don’t have much wiggle room in your budget, a mortgage lender can assume you’re only one major car repair away from financial disaster.

It’s also important to be able to show you have a solid, reliable income. Whether you’re an employee, own your own business or have another type of income, it must be steady and dependable.

We hope that our advice has helped you prepare for homeownership. Call the team at Integrity First Lending anytime you have questions or need help applying for a home loan in Utah.

How to Get a VA Loan in Utah

Are you wondering if you qualify for a Veterans Administration loan in Utah? These loans come with very favorable terms, but only certain military personnel are allowed to apply for them. Integrity First Lending facilitates VA loans for homebuyers in Salt Lake City and throughout Utah.

How to Get a VA Loan in Utah

What Is a VA Loan?

President Franklin D. Roosevelt created VA loans in 1944 as one of the many benefits of the GI Bill. As such, VA loans are backed by the government in the same way that FHA loans and USDA loans are.

VA loans are prized mostly for their $0 down option. VA loans allow homebuyers to finance 100% of their home with no money down. It is possible to get a $0 down deal with other mortgage programs, but their terms and conditions are usually more restrictive. Often when homebuyers put down less than 20% on a home, they must pay private mortgage insurance (usually $100-$200 per month) until they reach 20% equity.

While a VA loan does not require you to pay PMI, there is a funding fee that runs about 2%-3% of the purchase price of the home. However, it is usually less than PMI, and most mortgage lenders will allow you to roll the fee into the loan, so you don’t need to come up with the cash.

Who Can Apply for a VA Loan?

Generally speaking, service members, veterans and surviving spouses of veterans can apply for VA loans. You are considered a veteran if you have served 181 days during peacetime or 90 consecutive days during wartime.

If you have been dishonorably discharged, you can’t apply for a VA loan. You don’t need to be honorably discharged however; other types of discharges are acceptable.

Those in the Reserves or National Guard can apply only if they have served for at least six consecutive years.

If you’re the surviving spouse of a veteran who has died in the line of duty or from injuries they suffered while serving, you may apply for a VA loan.

Who Qualifies for a VA Loan?

Once you determine you are eligible to apply, your mortgage lender will look at other qualifying factors before approving you for a VA loan.

The government does not require VA loan applicants to have a minimum credit score, but most mortgage lenders do. If you have filed for bankruptcy, the wait to apply for a VA loan is shorter than it is for some other loans.

You can get a VA loan if you don’t have a job, but you must show that you have a source of income, such as Social Security, disability, alimony, etc. You can’t get a VA loan if you owe back child support.

What Can You Use a VA Loan For?

You can use your VA loan to buy a home, a mobile home or land if you are building your home on it right away. You can even use your VA loan to fix up the home you already own.

Want to see if you qualify for a VA loan? Stop into Integrity First Lending or apply online today.

What’s the Difference Between a Home Equity Loan and a HELOC?

Many people think a home equity loan and a home equity line of credit are the same thing. They’re similar, but they aren’t exactly the same. Learn the difference between home equity loans and home equity lines of credit from the experience team at Integrity First Lending of Utah.

Home Equity Loans vs HELOCs

What Is a Home Equity Loan?

A home equity loan is money you borrow against the equity in your home. Many homeowners think their home equity is equal to the amount they have paid thus far on their mortgage, but that’s not exactly how your home equity is determined.

Let’s say you put $20,000 down 10 years ago on a $300,000 home and since then you have paid in $80,000. That’s $100,000 in home equity, right? Not necessarily.

When you first begin paying your mortgage, more of each payment goes to interest than principal, so the amount you owe will appear to shrink more slowly than you might have thought.

However, it is likely your home has increased in value in the last 10 years. If you have made home improvements, it may have increased even more. So you may have more than $100,000 in equity in your home. You may be asked to get an appraisal to determine the exact value of your property.

With a home equity loan, you can usually borrow up to 80% of the value of your home and use it for anything you like — home improvements, college tuition, debt consolidation or even a vacation.

What Is a Home Equity Line of Credit?

When you are approved for a home equity loan, you get the amount in a lump sum. When you’re approved for a home equity line of credit, you are given access to a certain amount of money for a predetermined period of time.

One advantage of a HELOC over a home equity loan is that you can take out only as much money as you need at a time, rather than one large lump sum. This may help prevent you from overspending. However, interest rates on HELOCs are variable, while interest rates on home equity loans are fixed. A variable interest rate can sometimes impact your budget negatively when rates change.

In a way, a HELOC is a bit like having a credit card. You have a fixed amount you are allowed to spend anytime on anything you want. One important difference is that if you find yourself unable to pay back the money you withdrew with your HELOC, your lender could sell your home in order to get their money back. When you use a credit card, that loan is unsecured. That’s why the interest rates on credit cards over time are astronomical.

Home Equity Loans from Integrity First Lending

If you’re not sure if a home equity loan or a HELOC would be better for your situation, talk to the experts at Integrity First Lending of Salt Lake City, Utah. We’ll run the numbers for you so you’ll have the information you need to make the right decision for you.

How Do Mortgage Interest Rates Work?

You may have heard that mortgage interest rates are at historic lows. It’s true, and it’s a good time to buy a home in Utah — or anywhere, for that matter. But why do interest rates vary? Why are they not the same every day for everyone? The mortgage lenders at Integrity First Lending explain how to determine what kind of mortgage interest rate in Utah you can expect.

How Do Mortgage Interest Rates Work

Mortgage Interest Rates and Terms

One aspect of mortgage lending that has a big effect on mortgage interest rates is the term of the loan. The term is how long you will pay on your loan. Common loan terms are 15, 20, 25 and 30 years. When you Google “mortgage interest rates today,” the first number that comes up is usually for a 30-year loan, since these are most common.

Interest rates go down as the term gets lower, with a 15-year term being the lowest. The reason these rates are lower is because the mortgage lender doesn’t have to wait as long to get their money back.

Fixed-Rate Mortgages vs. ARMs

A fixed-rate mortgage stays the same throughout the life of your loan. Whatever rate you got when you took out the mortgage is the rate you keep. The only way to change it is to refinance your loan. Many homeowners refinance when rates fall, taking advantage of lower interest rates. If they shorten the term of their loan at the same time, they could save even more.

An ARM, also known as an adjustable-rate mortgage, fluctuates with the market. If interest rates go up, your interest rate will go up. If rates go down, your rate will go down. Many people dislike the uncertainty of not knowing how, when or if their mortgage payment will change and if they will be able to afford it.

The good part about an ARM is that when homebuyers agree to this type of rate, they usually get a lower introductory rate that is locked in for a period of years. As this period expires, homebuyers can refinance and get a fixed-rate mortgage or a new ARM with better rates.

Your Credit Score & History

Regardless of whether you choose a fixed-rate mortgage or an ARM, or what the term of your loan is, your interest rate may be affected by your credit score. Homebuyers with good credit scores will get the lowest interest rates. Those with poor credit scores may not get home loan approval at all, and those in the middle may be approved, but at a higher interest rate.

Your mortgage interest rate is tied to risk. If your credit score is mediocre, the mortgage lender is taking a bigger risk by expecting you to make your payments in full and on time than they would with someone with a higher credit score. If you’re not in a big hurry to purchase a home, you may want to wait six months to a year for your credit score to improve enough to help you get a better mortgage rate in Utah.

For more information about mortgage rates or to apply for a home loan, home equity loan or to refinance your home in Utah, talk to the friendly, helpful team at Integrity First Lending.

Should I Get a Home Equity Loan in Utah?

When you’re having cash flow problems, you might consider a home equity loan in Utah. These types of loans can be a lifesaver, or a way to achieve your dreams. But it’s good to consider the ins and outs of a home equity loan before deciding to apply for one. The mortgage lenders at Integrity First Lending help clients get approved for home equity loans in Utah.

Should I Get a Home Equity Loan in Utah?

What Is a Home Equity Loan?

When you get a home equity loan, you are borrowing against the equity in your home. The amount available to you is the value of the home minus the amount you owe on it. If you have owned your home for many years, the value of your home might be much greater than it was when you bought it. So you may have only paid $100,000 toward your principal, but have $250,000 in equity, due to the increasing value of your home.

What Is a Home Equity Loan For?

The beauty of a home equity loan is that it can be used for anything. No one asks you what you will use the money for. You can pay off school loans, buy a new car, lend your children money for a down payment on their own homes, do home improvements or take a fancy vacation.

That being said, there is some accepted wisdom about what type of expenditure is and is not a good reason to take out a home equity loan. Some of it comes down to math.

Should You Get a Home Equity Loan?

If you’re paying on a student loan that’s 5% interest and you could refinance your home at 2.8% to take out some of the equity to pay off that debt, you could save a lot of money. However, if you drop below 20% equity in your home and you have to start paying PMI, that will eat into some of your savings.

If you want to take out a home equity loan in Utah to improve your home through expansion or renovations, this is usually considered a worthwhile investment.

Taking out a home equity loan to buy a new car or finance a fancy vacation might not be a great idea, however. These are not investments that will improve your financial outlook. Similarly, you should be careful if you plan to take out a home equity loan to lend someone money, even if it’s a family member, because they may not be able to pay the money back.

Taking out a home equity loan to pay bills should be a last resort. If you have lost your job and fallen on hard times, your home equity might be all you have right now. But if you dip into it and you are unable to pay your mortgage later, you could lose your home.

Best Mortgage Company in Utah

We hope our mortgage lenders’ advice was helpful to you in deciding whether to get a home equity loan in Utah. When you’re ready to apply, use our online tool or make an appointment to come in and apply in person. We’re here to help!

How Much Money Down Do I Need for a Home Loan in Utah?

Arguably, the hardest part of buying a home in Utah is coming up with the down payment. You may know people who have put tens of thousands of dollars down and others who got a zero-down mortgage in Utah. How does it work? How much do you really need? The mortgage lenders at Integrity First Lending can tell you.

How Much Money Down Do I Need for a Home Loan?

How Much Is a Traditional Down Payment?

Traditionally, mortgage lenders have recommended that homebuyers save up 20% of the purchase price of a home in their target price range. Most homebuyers who don’t have 20% to put down have to pay PMI (private mortgage insurance) each month until they achieve 20% equity in the home.

PMI protects the mortgage lender from losses in the case of foreclosure. But paying $100-$200 more per month until you reach 20% equity can take a long time and cost many thousands of dollars. And PMI doesn’t go toward your mortgage — either the interest or the principal. It goes straight to the insurance company.

Housing Prices and Down Payments

The median home price in Salt Lake City today is about a half-million dollars. When you consider the whole state of Utah — including rural areas — the price drops to $400,000. So a down payment of 20% on most homes in Utah is about $80,000. As a longtime Utah mortgage company, we understand that it can be hard to save up $80,000-$100,000.

Especially if you are paying on student loans or other types of debt, it can take many years to save that much money.

What are your alternatives?

How to Buy a Home in Utah with Less Money Down

Many mortgage lenders will approve your mortgage with 3% down if you have a minimum credit score of 620. FHA loans often accept 3.5% down. However, that’s still $13,000-$15,000. And you’ll have to pay PMI along with your monthly payment of mortgage, interest and taxes.

If you’re a first-time homebuyer, you may qualify for a zero-down home loan in Utah. If you’re amenable to living in a rural area, you may be able to qualify for a USDA loan, which is also no money down. If you’re a service member, veteran or the surviving spouse of a service member or veteran, you may qualify for a VA loan, which requires no money down.

Both VA and USDA loans also do not require PMI; however, you must pay fees to the lender at closing to protect them against foreclosure.

Low Current Mortgage Rates in Utah

Whether you want to get a home in Salt Lake City or another part of Utah, the mortgage lenders at Integrity Lending can help. Mortgage rates in Utah are historically low, so now is the best time to buy. Give us a call or come in to talk to our friendly mortgage lenders. We’ll help you figure out a way to become a Utah homeowner.

How to Use a Mortgage Payment Calculator

When you’re considering buying a home, you want to make sure you choose one that you can afford. But how do you know? Integrity First Lending’s mortgage payment calculator can help.

How to Use a Mortgage Payment Calculator

How Do You Use a Mortgage Payment Calculator?

Integrity First Lending has a tool that makes it easy to calculate your mortgage payments. Simply plug in the numbers: the cost of the home, your down payment, the interest rate, the term you are choosing and the type of mortgage you’re applying for. Our mortgage payment calculator then gives you an estimate of what your monthly mortgage payments will be.

This figure is an estimate because several factors can affect the final number:

  • Type of interest rate: If you choose an adjustable-rate mortgage rather than a fixed-rate mortgage, your monthly payments can change — sometimes significantly — with the going interest rates.
  • Taxes: If the city, town or state you live in raises property taxes, your monthly mortgage payments will go up. Most mortgage lenders collect tax payments from homeowners every month to put in escrow to pay their property taxes. So while property taxes are not technically part of your mortgage, you pay them at the same time as your mortgage. However, even when you pay your mortgage off, you must still pay property taxes, although if you are elderly, you may be eligible for a reduction in the amount.
  • PMI: If a homebuyer does not put at least 20% down on their home, they must pay private mortgage insurance until 20% equity is reached. This number is often $100-$200 per month, depending on many factors, including your credit score.

Determining How Much House You Can Afford

The beauty of our mortgage payment calculator is that you can play with the numbers and make adjustments to find a way to make buying a house affordable for you.

For instance, if the mortgage payment calculator says your payment will be about $2,000 and that is too much for you, try lengthening the term to see how much it lowers your payments. Or, if you can borrow money from a friend or relative to increase your down payment, this will also decrease your monthly payments.

If you can’t find a way to make the numbers work, consider shopping for a lower-priced house.

As mortgage lenders, we sometimes see homeowners who do not leave themselves enough wiggle room with their mortgage. They take on a large mortgage that they can technically pay, but if something unexpected happens — a job loss, an expensive car repair or another financial setback — it can quickly tip the scales, putting them behind on mortgage payments. This is not only stressful, but it affects your credit too.

It’s better to leave yourself a little cushion when shopping for a home loan in Utah.

Your Friendly Mortgage Company in Utah

Now that you know how our mortgage payment calculator works, play with it for a little while and then come in and see our mortgage lenders. We’ll collect some information from you, such as your income, credit score, debt-to-income ratio, etc., and run the numbers to see what type of mortgage you qualify for and how much house you can afford. Once you are pre-approved, you can start shopping for a home in Utah with confidence!

How to Get a Home Loan in Utah After Bankruptcy

If you have filed for bankruptcy, you may wonder when you will be eligible to apply for a home loan in Utah. The time period varies based on a number of factors. To find out whether — or when — you qualify for a home loan in Salt Lake City after filing for bankruptcy, talk to the mortgage lenders at Integrity First Lending.

How to Get a Home Loan in Utah After Bankruptcy

How Bankruptcy Affects Your Credit

Filing for bankruptcy can be a difficult and painful choice. Consumers who file for bankruptcy often feel overwhelmed, afraid and sad.

While filing for bankruptcy can sometimes be a relief of sorts, it also carries with it a certain stigma. Many lenders and others who extend credit to consumers assume that someone who files for bankruptcy is a poor money manager who cannot be trusted to pay their bills.

The truth is, however, that the most common reason people file for bankruptcy is due to medical bills, which are no fault of their own. Other reasons include divorce, which many people also have no say in, and student loans.

Regardless of the reason, those who file for bankruptcy suffer by being unable to obtain credit for a period of time.

How Long Do You Have to Wait to Apply for a Home Loan in Utah?

If you filed for Chapter 7 bankruptcy, which discharges many of your debts (but not student loans or income tax debt), you have to wait at least four years to apply for a conventional home loan in Utah.

However, if you apply for a USDA loan, you only need to wait three years. For VA and FHA loans, it’s two years. You may or may not qualify for these programs, however; talk to the mortgage lenders at Integrity First Lending to see if you are eligible to apply.

With a Chapter 13 bankruptcy filing, you must wait at least two years after the court discharges your bankruptcy to apply for a conventional mortgage. You may be eligible to apply for government-backed mortgages sooner.

Why Your Credit Matters with Home Loans in Utah

These waiting periods are minimums. If you have made late payments or had other credit snafus during this time, it can affect your eligibility to apply for a mortgage.

Your credit score and your credit history are like records of your financial health and behavior. Lenders take a risk when they approve your mortgage, and some may opt not to take that risk Or, they may take the risk but charge higher interest rates because of your credit history.

The good news is that your financial mistakes will not follow you forever. They eventually disappear from your credit report, and hopefully are replaced with line items about on-time payments.

Home Loans from Integrity First Lending

If you filed for bankruptcy and wonder if you are eligible yet to apply for a home loan in Utah, come see the mortgage lenders at Integrity First Lending. We’ll run the numbers with you, and if you don’t qualify yet, we’ll tell you what you can do to improve your chances of qualifying next time. We’re your friendly, local Salt Lake City mortgage company.

Is Now a Good Time to Refinance in Utah?

You may have considered refinancing during the pandemic, but you may have been unsure about whether that was the best time. Should you wait to see if mortgage rates in Utah fall even lower? Or will you miss out on a better deal by waiting? It can be hard to tell. You need a Utah mortgage lender like Integrity First Lending on your side that knows the ins and outs of refinancing.

Is Now a Good Time to Refinance in Utah?

Why Refinance Your Home in Utah?

There are several reasons homeowners in Utah are interested in refinancing. One of the most common reasons to refinance is to take advantage of lower interest rates. Interest rates have fallen over the past year, but in order for refinancing to make sense, the interest rate needs to fall enough to save you money.

Of course even a tenth of a percent can save you money over the life of the loan, but the process of refinancing also costs you money, so you have to do the calculations to see if you will come out ahead. Closing costs are often 2% to 3% of your loan, which can be substantial, depending on how much you want to borrow. You may also have to pay for an appraisal, lawyer’s fees and other costs.

If you aren’t saving enough with your lower interest rate, refinancing might not be worth it. It isn’t always easy to figure out, so that’s why it’s good to have help from a trusted mortgage company in Salt Lake City.

Refinancing to Improve Your Terms

When you originally took out your mortgage, you might have chosen a 30-year loan in order to have monthly payments that were low enough to afford. If your circumstances have changed, however, and you can now afford higher payments (and take advantage of a lower interest rate), you could refinance your home in Utah and choose a shorter term, such as 20 or even 15 years.

The interest rates for these shorter-term loans are even lower — plus, you save money by paying off your home quicker.

Another reason homeowners might want to refinance their home in Utah is to switch from an adjustable rate mortgage to a fixed-rate mortgage. An ARM usually offers lower interest rates at the beginning of the loan than a fixed-rate loan. However, at the end of this introductory period, the rates go up, and can continue to fluctuate over the life of the loan, unlike a fixed-rate mortgage, which stays the same.

Some homeowners prefer the certainty of a fixed-rate mortgage, but needed the affordability of the lower rates when they first bought their home.

Best Mortgage Company in Utah

If you’re looking to save money by refinancing your home in Utah, consult with the mortgage lenders at Integrity First Lending. We’ll look at current mortgage rates, run the numbers with you and help you determine whether now is a good time to refinance your mortgage.

How to Get a Zero Down Mortgage in Utah

It can be hard to save up $50,000 or more for a down payment on a home. You may wonder if you qualify for a zero down mortgage in Utah. Talk to the mortgage lenders at Integrity First Lending of Salt Lake City. We can help you find out if you qualify for this helpful program.

zero down mortgage in Utah

Qualifications for a Zero Down Mortgage in Utah

To qualify for a zero down mortgage, applicants need a good credit score. For this type of mortgage, that’s usually around 620-700. If your credit score is below that, you can take some time to bring it back up and then apply for a mortgage.

Other factors your lender will look at are your credit history, debt-to-income ratio, employment history and salary, and possibly other considerations as well.

Pros of a Zero Down Mortgage

The most attractive part of a zero down mortgage for most home buyers in Utah is that they don’t have to wait to save up a down payment in order to become a homeowner. This means you don’t have to spend years paying rent without anything to show for it.

Owning your own home is a great investment. When you make your mortgage payment, you’re paying toward something you own, versus a rent payment, in which you’re paying for something someone else owns.

Cons of a Zero Down Mortgage

When you have no money to put down for a mortgage, you must borrow more money to pay for your house. That means you owe more, and your payments will be larger.

Home buyers who don’t put at least 20% down on their homes must pay private mortgage insurance every month until they build up 20% equity. This is usually another $100-$200 on top of your mortgage payment.

When you have no equity in your home, it’s possible you could end up in an “upside-down mortgage” situation. What this means is that if you put zero down on a $300,000 home and two years later you wanted to sell it but it was only valued at $275,000, you would owe more on your home than it was worth.

This rarely happens because lenders take great pains to make sure they lend money safely, and would not approve a loan for an overpriced home. Further, if you can hang on to an upside-down mortgage and avoid selling and moving for a couple of years, your value would likely come back up during this time.

Best Mortgage Lenders in Utah

The pros of a zero-down mortgage often outweigh the cons, since buying a home is usually a better financial decision than renting. If you’re not sure, come talk to the mortgage lenders at Integrity First Lending. We’ll look over your financial information and run some numbers to see whether we think you would qualify for a zero-down loan. Don’t wait — call today!