Five Common Pitfalls When Getting A Home Mortgage

Five Common Pitfalls When Getting a​ Home Mortgage
Owning a​ home is​ a​ lifetime dream for many. ​
The best way of​ acquiring a​ loan is​ with the​ help of​ a​ home equity mortgage. ​
You will also sometimes feel the​ requirement to​ get some finance by providing your home as​ collateral. ​
There are some fine points to​ look before you​ sign up for a​ loan by providing your home as​ guarantee.
Pitfall number 1 Dealing with wrong people
You have heard enough of​ frauds and​ cheats. ​
Financing your requirements with unscrupulous can cause you​ lose the​ equity you​ build up and​ your home as​ a​ whole. ​
Don’t talk finance with any party that asks you​ to​ claim more income than you​ actually have and​ to​ apply for higher amounts than you​ require. ​
Such people are also likely to​ sign unfilled forms,​ not allow you​ to​ keep a​ copy of​ the​ documents you​ sign and​ most importantly put pressure on​ you​ to​ pay huge monthly payments than you​ could afford,​ usually at ​ a​ later stage of​ loan approval.
Pitfall Number 2 Not Keeping a​ Good Credit Score While Applying for Home Equity Mortgage
Major credit purchases immediately before you​ apply for loan can affect your score. ​
Not caring too much about your credit score for a​ long time can damage your credit scores and​ you​ will not be able to​ quickly build up the​ damage. ​
Healthy credit score is​ always desirable to​ get lower interest on​ home mortgage too. ​
However,​ succumbing to​ the​ pressure of​ the​ first lender that sites your average credit score as​ reason for higher interest is​ also a​ major pitfall you​ should avoid. ​
if ​ the​ credit score is​ affected due to​ inability to​ repay a​ credit due to​ illness or​ temporary loss of​ job,​ you​ can still shop around and​ negotiate your way to​ low interest home mortgage.
Pitfall Number 3 Allowing a​ lot of​ credit Companies Check your Credit Score
Equifax,​ TransUnion and​ Experian are the​ main credit rating agencies. ​
Ordering your own credit score can cost you​ $ 40. ​
Your credit score drops a​ little with each credit check by lending companies. ​
if ​ you​ shop around and​ allow all the​ companies to​ check your credit score,​ it​ can drop considerably,​ disqualifying you​ from lower interest mortgage. ​
Allow only the​ company you​ zero in​ on​ for your financing requirements to​ check your credit score.
Pitfall Number 4 Holding Back Information about your Credit History from Your Broker
Once you​ choose to​ deal with a​ mortgage broker to​ find a​ good home equity mortgage,​ you​ must talk with him if ​ you​ had any credit problems in​ the​ recent history. ​
if ​ you​ try to​ misguide the​ broker,​ you​ will be in​ a​ bad light to​ getting a​ mortgage. ​
if ​ you​ describe your situation well,​ chances are higher that he will find a​ low cost loan to​ you.
Pitfall Number 5 Overlooking Overages and​ giving up the​ power of​ negotiation
Overage is​ the​ difference between lowest available price for the​ mortgage and​ the​ higher price the​ buyer is​ willing to​ pay. ​
Lenders or​ brokers can keep the​ whole of​ or​ a​ part of​ the​ difference as​ additional compensation. ​
Ask your brokers how much he gets as​ compensation.

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