The Seven Deadly Sins In Home Loan Lending



The Seven Deadly Sins In Home Loan Lending

The Seven Deadly Sins in​ Home Loan Lending
The seven deadly sins in​ home loan lending are no different from the​ seven deadly sins outlined in​ the​ Bible .​
The latter damns your soul; the​ former can decimate your finances .​
Whether you're buying a​ house by yourself,​ with your partner,​ or​ with a​ friend,​ be sure to​ avoid the​ following costly mistakes .​
1 .​
Thou shalt get your priorities straight .​
Unless you​ are earning the​ equivalent of​ three people's wages,​ there's no way you​ can pay off a​ house loan,​ car loan,​ and a​ student loan at​ the​ same time .​
In fact,​ if​ you're living on​ the​ budget of​ the​ recently employed,​ you​ have no business setting your sights on​ that sprawling four-bedroom number in​ the​ city's most exclusive neighborhood .​
Clearly,​ you​ cannot serve two masters at​ the​ same time .​
Before you​ go home loan lending,​ separate your needs from your wants .​
Sort your priorities,​ and decide whether it's a​ house or​ a​ new car that you​ need.
2 .​
Thou shalt not underestimate home loan lending costs .​
In home loan lending,​ costs follow only one trajectory: upward .​
Downpayment and monthly payments are not the​ only costs you​ have to​ budget .​
You need to​ factor in​ insurance and start-up expenses,​ in​ the​ form of​ furniture purchases and getting the​ cable TV and the​ telephone turned on​ .​
3 .​
Thou shalt not get a​ mortgage without first window-shopping thoroughly .​
Home loan lending experts point out the​ only way to​ make sure you​ get the​ best deal in​ the​ market is​ to​ see exactly what type of​ deals are in​ the​ market .​
So,​ shop around for as​ long and as​ often as​ humanly possible .​
4 .​
Thou shalt not sign contracts without reading the​ fine print .​
Home loan lending is​ no joke .​
Whatever contract you​ sign is​ legally binding between you​ and your broker .​
Be sure to​ pore over the​ contract and ask questions about the​ terms you​ do not understand .​
a​ home loan lending contract,​ no matter how seemingly straightforward,​ is​ one document you​ should not peruse with glazed eyes and a​ wandering mind .​
Ask about suspicious-looking clauses .​
If it​ reeks of​ fish,​ it​ probably is​ fishy .​
5 .​
Thou shalt not be blinded by exotic-sounding offers and very long-term arrangements .​
Many lenders and brokers will always try to​ foist huge houses on​ you​ .​
After all,​ the​ bigger and costlier the​ house they sell,​ the​ chunkier their commission .​
Be very wary of​ offers that sound too good to​ be true .​
In particular,​ know that grandfather loans will earn you​ very small house equity.
6 .​
Thou shalt never go without home insurance .​
Unless you​ can afford to​ replace everything you​ own in​ case of​ theft,​ fire,​ earthquake,​ or​ the​ end of​ the​ world,​ you​ need insurance .​
This can cost you​ whoopingly large sums,​ but it​ will be money well-spent.
7 .​
Thou shalt not default on​ your payments .​
In home loan lending,​ what has been given can be taken away .​
If you​ cannot keep up payments on​ your house,​ it​ could be foreclosed .​
If you​ ever find yourself having trouble with the​ payments,​ home loan lending experts advice calling your lender or​ broker immediately and explaining the​ problem .​
Chances are,​ you​ will be given a​ grace period or​ an​ alternative pay-off scheme .​
Buying a​ house is​ a​ rite of​ passage akin to​ making the​ transition from Daddy's little girl to​ full-fledged adult .​
To go through the​ rite successfully,​ take note of​ the​ seven deadly sins in​ home loan lending .​
There's no point in​ getting a​ house in​ exchange for your financial soul.

The Seven Deadly Sins In Home Loan Lending





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