As a home buyer, you want to keep your credit score high and make sure you do not do anything to jeopardize your mortgage application. Unfortunately, people who are unfamiliar with the mortgage process may skip several steps which could potentially ruin their chance of getting a loan and closing a house deal.
To eliminate this possibility and other costly consequences, work with a mortgage agent. They review your financial condition, understand your goals and accordingly assist you to make the right mortgage decision.
To help you learn how to avoid costly errors and ensure you make the right investment, Mel Neis has compiled a list of the most common mistakes people make when obtaining a mortgage.
1. Not getting pre-approved. A mortgage pre-approval is a necessary part of a home-buying experience. However, before a lender decides whether or not to give you a loan, they analyze your credit reports, employment history, and other aspects. They then estimate how much you can borrow and at what rate. Moreover, they tell you the value of a house you can afford and also locks in the interest rate for one-hundred-and-twenty days. If you fail to get a mortgage pre-approved, you may find your dream home but realize much later that you do not have enough money to purchase it!
2. Taking on new debt. Making a large purchase before or during the loan process can not only hurt your credit score but also significantly decrease the value of a house you want to buy. Moreover, a lender could reject your mortgage application, or a bank may ask you to pay a higher interest rate.
3. Ignoring the real cost of home ownership. There’s more to home ownership than merely monthly mortgage payments. If you’re buying a house, you need to take property taxes, maintenance, home insurance, condo fees, utility bills, and home furnishings into the total monthly cost. Often, people forget to factor in all these expenses.
4. Assuming all mortgage products and lenders are the same. Another mortgage mistake often made by home buyers is believing that all mortgage products, lender rates, and terms are identical. A critical decision that must be made when purchasing a home is deciding the type of mortgage that suits your financial circumstances.
If you're looking for a mortgage broker in Red Deer, Alberta, reach out to Mel Neis. I have been providing mortgage services to a range of clientele for more than a decade. I educate and support clients throughout the mortgage process, and offer unbiased guidance that works best for them.