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What to Do Before Applying for a Mortgage Loan in California

Much has been written about the mortgage application and approval process in California. You’ll find countless articles online that explain the different steps in the application process, the path to final approval, the paperwork and documents required, etc.

But what about the period leading up to your application? What can you do before applying for a mortgage loan in California, to increase your chance for approval and ultimate success? Let’s explore.

Before Applying for a Mortgage Loan in California

Disclaimer: The mortgage application process in California can vary from one person to the next, for a number of reasons. For instance, some government loan programs might require additional steps and documentation. So portions of this article might not apply to your particular situation.

You’re planning to buy a home in California sometime in the future. You need a mortgage loan to help make that happen.

The question is, what should you be doing right now, before you apply for a loan? What steps should you take in the weeks or months leading up to your mortgage application? Here are five things you might want to do and consider…

1. Review your credit reports.

Did you know you have three different credit reports? Did you know they contain a detailed history of your loans and credit accounts? It’s true.

The information in your credit report reports is used to produce your credit scores (see item #2 below). If you plan to apply for a mortgage loan in California sometime in the near future, you might want to review your credit reports ahead of time.

Check them over for accuracy. Dispute any mistakes you find through the bureau that produced the report. You can start by visiting, the official website for obtaining your free reports.

Errors and inaccuracies in your credit reports could affect your credit score, which in turn could affect your ability to qualify for financing (mortgage, auto loans, etc.). Reviewing your reports is a good step to take, before you apply for a mortgage loan in California.

2. Maintain a good credit score.

As mentioned above, your credit score can affect your ability to qualify for a home loan. Mortgage lenders typically use the FICO scoring range, which runs from 300 to 850. (A higher number is better.)

Having a higher credit score could improve your chances of getting a mortgage loan in California. It could also help you secure a better interest rate. A low score, on the other, might make it harder to qualify for a home loan.

As with the reports mentioned above, you can also review your credit scores before applying for a mortgage loan. It’s not required, but it will give you some better insight into your current credit standing.

The best way to maintain a good score (or improve a low one) is by paying your bills on time and using credit cards sparingly. According to, your payment history on loans and credit accounts counts toward 35% of your overall score — more than any other single factor.

Again, you can do this kind of research before you apply for a mortgage loan in California, if you choose to.

3. Save as much money as possible.

Chances are, you’ll need a certain amount of money in the bank to get approved for a home loan.

First, there’s the down payment to consider. Depending on the percentage you put down, this could easily add up to thousands of dollars. You’ll probably also encounter some closing costs, which could also add up to several thousand dollars.

Depending on the type and size of your mortgage loan, you might also need to have additional “cash reserves” in the bank. This isn’t required for all loans — but it does apply in certain scenarios.

The point is, you’ll benefit by saving as much money as possible, before you apply for a home loan. It’s never too early to start a home-buying fund!

4. Avoid major purchases, when possible.

You could improve your chances of getting approved for a home loan if you avoid major purchases in the weeks before applying for a mortgage. In this context, “major” refers to the kinds of purchases that require a credit card or loan. Vacations, home furnishings, and new cars typically fall into this category.

Purchasing big-ticket items can affect you in two ways. First, it reduces those all-important home buying funds we talked about earlier. It can also increase your debt-to-income ratio. Both of these things could affect your chances of getting approved. It’s one more thing to think about, before applying for a mortgage in California.

Sometimes it’s necessary to purchase certain items. Other times, it’s more of a luxury. In these latter cases, it might be best to postpone major purchase until after you’ve secured your home loan.

5. Review your financing options.

You have a lot of options when it comes to getting a home loan, and therefore a lot of choices to make. So you might want to spend some researching these options, before you apply for a mortgage.

Here are some of the common choices relating to home loans:

  • Using a conventional versus a government-backed mortgage
  • Choosing a fixed or an adjustable interest rate
  • Whether or not to pay “discount points” to reduce the interest rate
  • How much of a down payment you want to make

It’s always a good idea for borrowers to research their mortgage options, before applying for a home loan. At Bridgepoint Funding, we go above and beyond to educate our clients about their financing options. But we also encourage borrowers to educate themselves. A little homework goes a long way.

Mike Trejo

Mike Trejo is a Bay Area mortgage broker with 20+ years of knowledge and experience.

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