There are numerous mortgage products one can choose from, and borrowers can find great deals on homes and mortgage products if they know where and how to find them. Here are 8 tips to help you save money and make your home buying process easier
Tip 1 – Ask a friend, family member or a Realtor for a referral for a reputable mortgage broker or lender
Tip 2 – Check your credit report and clean up negative items before you apply for a mortgage so you can get better terms
Tip 3 – Get pre-approved or pre-qualified to find out how much home you can afford before you start looking for homes
Tip 4 – Educate yourself by comparison shopping to find the best rate and terms. Using a mortgage lender or broker saves you time and money because the mortgage broker can do all the leg work for you.
Tip 5 – Don’t sign any mortgage documents until you are given a breakdown on costs associated with your mortgage and understand the terms of your loan. By law, mortgage brokers and lenders must give you a disclosure statement and good faith estimate of the costs of your loan.
Tip 6 – Don’t assume that all mortgage products are the same. There are teaser rate mortgages that offer you low initial interest rates and payments. However, before you know it, your monthly mortgage payment has doubled or tripled. Avoid interest only mortgage products as well. Choosing the wrong mortgage could put you at risk of losing your home. Stick with a traditional 30 year fixed rate mortgage if you plan to keep your home for more than five years, or a variable rate mortgage if you plan on keeping the home for a short period of time.
Tip 7 – Don’t go out and make any expensive purchases like buying a new car or increase your credit card debt while you are in the process of obtaining a home mortgage, as it could hurt your chances of being approved for your loan.
Tip 8 – Don’t borrow more than you can afford even if you qualify for more.
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