Mortgage Mistakes – Failure to Understand Mortgage Rates
Do you believe that mortgage rates are actually fixed only once a day? If yes, you’re wrong! This is one of the mortgage mistakes. Mortgage rates are similar to stock prices. These rates will and can fluctuate multiple times in a day. This is exactly why home buyers must keep a close eye on fluctuating mortgage rates. Buyers need to go for a lender only after comparing different quotes for the same loan.
Be Aware of Your Credit First
One of the biggest mortgage mistakes is to start your pursuit of a house, without first checking your credit. Moving on with a mortgage plan, without checking credit is the most common mistake. This can easily be avoided but home buyers prefer to ignore it.
If you don’t check your credit first, you are more likely to have credit issues. This includes the ones you’ve never expected like a judgment in some other state or even late payments on accounts you’ve already forgotten. So check your credit beforehand to avoid nasty surprises. These mortgage mistakes can affect your credit score and cause problems negotiating the mortgage rate with the lender.
Not Getting Pre-Approval but Pre-Qualification
Do you understand the basic difference between pre-approval and pre-qualification? Because most homebuyers don’t!
A mortgage pre-qualification is as good as a piece of paper. It issued by the lender and based on the information provided by the potential borrower. This information could be true as well as false. On the contrary, getting a pre-approval is very important for many reasons. This document is issued when the lender thoroughly reviews the borrows documents. These documents include tax returns, pay stubs, credit reports and all other critical financial information in relation to the borrower.
Bottom line, proceeding with a mortgage without getting a pre-approval is a mistake made by many home buyers. So take some time and put in the extra effort to get a mortgage pre-approval. Your pre-approval will be needed when you want to out in an offer to buy a house.
The above discussed mortgage mistakes can significantly affect your real estate transaction. It can also effect the years of enjoyment that you expect in your new house. By paying attention to these considerations, you can make your house buying process smooth. It will also be much less stressful.