4 Mortgage Mistakes to Avoid
The majority of homebuyers need a mortgage loan to purchase their home. As one of the biggest financial decisions a person will make in their life, mortgages should be taken seriously. Budgeting and planning are key to preventing mistakes from happening when navigating this new experience. Here are four mortgage mistakes to avoid as you begin searching for a new home.
1. Not Budgeting for Additional Costs
Home buying is costly. Outside of a mortgage payment, homebuyers should budget a few other expenses when purchasing a home. Private Mortgage Insurance, property taxes, closing costs, and necessary home improvement costs should all be accounted for during the first year after a home purchase. Together, these items can cost thousands of dollars depending on the home.
2. Skipping Pre-Approval
Getting a pre-approval before beginning your home search can be incredibly beneficial. Pre-approvals give homebuyers a clear budget and give home sellers the impression that you are a serious homebuyer. This no-surprises method helps the process run more smoothly for all parties.
3. Making Big Financial Changes Before Closing
Thinking of applying for a new credit card? Buying your dream car? Quitting your job? Purchasing a brand new furniture set for your new home? All of these things are huge no-gos before you get to the closing table. Making large financial decisions that affect available funds and your credit can result in losing your mortgage approval— and your new home as a result. Talk to your mortgage lender before making any major financial decisions to avoid risking your approval.
4. Choosing the Wrong Loan Type
The “best” housing loan type differs depending on a home buyer’s unique circumstances. Different mortgage loan programs offer varying levels of necessary credit, down payment amounts, interest rates, and offers for protected status groups (ex. veterans, low-income, etc.). Talking to a trusted lender is the best way to find the right loan type for you.
Steer clear of common mortgage mistakes! Our team of Savannah mortgage experts at Coastal Custom Mortgage can help you confidently meet your real estate goals. Give our office a call today to learn more and start your journey to homeownership.