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In part one of this two-part blog series, we went over some of the common mistakes we’ve seen from mortgage borrowers and homebuyers over the years. While mortgages can be simple, straightforward processes if you have the right team behind you and the right education, the wrong approach can lead to a few hiccups, including several that can be relatively costly.
At Primary Residential Mortgage, our mortgage brokers are here to ensure you never step into any of the home loan pitfalls out there as we guide you toward your best possible mortgage. Here are some additional areas to take great care in as you navigate the landscape.
Decreasing Income
Before you choose to enter the mortgage market, it’s a good idea to be relatively certain your income will not be lowered during the process. The primary reason this is important is because this can impact your application’s chances of success – inability to show quality income is a big red flag for many lenders.
In addition, however, it’s important to remember that you simply need all the funds you can get during this process. The more money you can pay toward your down payment during closing, the better interest rate you’ll get. Try to avoid taking any long vacations or doing anything else that will impact your income negatively.
Lack of Market Understanding
Within the real estate world, homes are assets. Just like any other asset, you want to see an appreciation in value over time – and in many cases, trends develop here in terms of home areas, styles and other factors.
This is a careful balancing act for buyers: Balancing these past trends with the simple reality that trends can and do change over time. This is where quality mortgage brokers and real estate agents come in, lending experience and expertise to these nuanced areas.
Improper Location Choice
One of the big factors in home value is location, and there are several factors to be sure you research thoroughly: Median home prices in the area, school location and quality, commute distance to your job, crime rate, community amenities and much more. It’s vital to take the time to properly dig into each of these areas and how they affect your purchase.
Going Cheap on Inspections
Finally, you should never purchase a home without having it inspected by a reputable third party. This party will take an objective, unbiased look at all the major components of the home and their quality, assessing whether the listed price is fair based on a number of factors. Good home inspections cost $300 to $400, which may seem like a lot until you realize the untold thousands they can save you if they spot issues you were previously unaware of. Skimping on the home inspection is a big no-no for this reason.
For more on avoiding common homebuying mistakes, or to learn about any of our mortgage loan services or rates, speak to the staff at Primary Residential Mortgage today.
*PRMI NMLS 3094. PRMI is an Equal Housing Lender. Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. Programs, rates, terms, and conditions are subject to change and are subject to borrower(s) qualification. This is not a commitment to lend. Florida Office of Financial Regulation MLD646. Opinions expressed are solely my own and do not express the views of my employer.