4 shared Mortgage Mistakes
Forgetting the Fees
Some lenders offer what appears to be a great deal, but upon closer inspection you might find hidden fees which make up the difference. Document preparation, credit checks and other administrative responsibilities sometimes get listed as additional fees. Sometimes these are called junk fees. Get a good faith calculate in writing and compare carefully at the fees charges between lenders.
Some new home buyers use all obtainable cash for the down payment and closing costs. This is a big mistake since any kind of unexpected expense can put them into a tailspin. Keeping a three month living expense save set aside will protect you against foreclosure.
Do not forget to shop for your a home insurance policy. If you wait until the last minute you will not have time to shop around and find the best rate and policy. Most lenders will require an insurance policy before closing so leave enough time to compare the offers.
It’s not a lifelong commitment, but signing on the bottom line for a mortgage may feel like one. Getting into the wrong kind of mortgage is a mistake you can avoid by doing your homework and understanding the options. Rates, term, options for prepayments, penalties, balloons… keep your calculator handy to be able to compare them.
Avoiding these costly mistakes could save you a bundle over the years on the term of your loan. Be your own best financial advisor and do the homework needed before diving into a new home loan.