For first time buyers, the mortgage loan process can seem complex and confusing. On top of everything else, you need to figure out interest rates, loan terms, fixed versus variable rate mortgages, and more. In order to simplify and streamline the process, there are a few things you should look into before you apply for a home loan.
Be In The Know
It’s a good idea to get a copy of your credit report before you start applying for loans. There is nothing like getting yourself all ready to go house hunting and finding out you won’t qualify for a mortgage. While knowing what is in your credit report won’t tell you for sure if you will get a loan, it can prepare you for what you will be told when you sit down with a mortgage professional. There are plenty of ways to get your hands on a free copy of your credit report, and it pays to carefully review your credit report before applying. A surprising number of credit reports have
errors, which make a person’s credit score lower than it should be.
Expect Out Of Pocket Expenses
You will need to have some cash in the bank before you can buy a home, and many first time home buyers are surprised at the amount. There are extra costs associated with property, including legal fees, stamp duty, lender’s mortgage insurance (if required), building insurance and of course paying the removalists. These extras can end up being the equivalent of 5 to 7 per cent of the actual purchase price. to consider when you apply for a loan—that mortgage isn’t the only cost of buying. Before you go in to apply, be sure you have some extra cash on hand.
These are just a few points to consider to avoid costly mortgage mistakes.
When it comes to buying your first home, it can be a very exciting as well as a nerve-wracking time. By doing your research and preparing yourself for the process, you can ensure it goes more smoothly and you don’t run into any nasty surprises. Once you get that loan ready, you can start the fun part—searching for your first home!