by Clare Louise | January 17, 2019 12:45 pm
A home purchase is one of the most significant buys anyone can make in a lifetime. When it’s your first time buying a home, it is easy to feel excited, intimidated and overwhelmed at the same time. However, if you plan on getting a home loan to help you finance your home, there are things to consider which makes it easier to avoid mistakes.
This 2019, make sure you don’t make the same mistakes first-time homebuyers usually make by keeping in mind the following do’s and don’ts of the mortgage process.
Many first-time homebuyers tend to look for a home without first checking how much they can afford. This is one of the reasons some get disappointed after learning the homes they found and would love to acquire is way above the price rate they can afford. By getting pre-qualified and pre-approved, you’ll have an idea on how much you can spend on your home purchase thus eliminating the risk of you breaking your heart over a house that can’t be yours.
Good read: Pre-qualified vs. Pre-approved: What’s the Difference?
While you can go straight to lender-shopping without real-estate agents, mortgage brokers and other professionals by your side, you get to enjoy tons of benefits while working with people who have knowledge and experience in the home buying process. For example, working with a competent mortgage broker lets you shop around for a good Mortgage Lender Arlington that not only offers the best deals but actually understands your situation.
When you’re applying for a mortgage, it would be best to avoid opening new credits and purchasing expensive buys as this can have an impact on your finances. By adding debt, it can increase your Debt-To-Income Ratio which can cost you your home loan application. Instead of increasing debt, find ways to lower your DTI ratio to get better rates.
There are lots of mortgage programs available. Even if you find one with the lowest rates, that doesn’t necessarily mean you already hit the jackpot. The thing is, some lenders do advertise low-interest rates only for you to find out you’re better off with another home loan programs with a larger interest and lower backend fees. Ask your lender for all rates and fees and make sure you read and understand your mortgage disclosures.
According to Statistics, 33% of homebuyers in the US are all first-time buyers. Because of this, many tend to think that all the fees they’ll be paying will only include the basics such as the down payment, closing costs, and homeowner’s insurance, among the others. However, there are other fees to consider and even unforeseen expenses which can quickly add up. Don’t let yourself go house poor by anticipating and saving more than what you initially think you’ll need for your first home purchase.
There are lots of affordable mortgage programs guaranteed by different US departments. If you can only afford small down payments, then consider VA Loans, USDA Loans, FHA Loans and check one will best suit your situation. Each has its qualificatioc ns, pros and cons so make sure to check on them and ask your trusted mortgage broker for advice to get the best deals.
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