5 Huge Mortgage Mistakes Charlotte Homebuyers Make – and How to Avoid Them
As a Charlotte homebuyer, you may actively be seeking out information about your exciting, upcoming purchase. Buying a home is a huge financial investment and it can impact your lifestyle for many years to come. While it is important to learn more about what to look for in a home, it is also important to learn about mistakes homebuyers have made. When you learn more about mortgage mistakes that others have made, you can take steps to prevent making those same mistakes yourself.
Looking at Homes BEFORE Obtaining a Pre-Approval from a Lender
This is a common occurrence with many homebuyers – not simply first-time homebuyers. Finding out that you do not qualify for a mortgage in the price range that the home you love is in is traumatic for any buyer. Pre-approval can also help you actually WIN a bid in a bidding war and those typically occur the first day that a property is on the market. So, obtaining that pre-approval FIRST not only saves heart-break but, also helps a buyer buy that dream home with no hitches!
Making Large Credit Purchases Prior to Closing on a New Home
This is also a common mistake that many buyers tend to make – even if it’s not the first home they’ve purchased a home. Many buyers simply must move in with that new furniture being delivered the minute the ink dries on their purchase! Interest rates are based on credit scores and debt-to-income ratios can be impacted, also affecting the pre-determined interest rates if debt-to-income ratios are impacted by credit purchases. So, save that new item purchase until AFTER the fact – let the ink dry and the Deed be recorded at the courthouse before you purchase new furniture, a new car or any other large items.
Committing to a Large Mortgage Payment
Many home buyers contact a mortgage professional to determine the largest loan amount and monthly payment for which they qualify. However, because you qualify for a loan amount and monthly payment from a lending perspective, does not mean that it is affordable for your budget. After all, you may have a more expensive lifestyle, childcare expenses and other expenses that are not factored into the lending equation.
Not Reviewing All Home Expenses
When you own a home, you will be required to pay for expenses that are not included in your mortgage, interest, insurance and tax payments. For example, you my have to pay for lawn or pool care, home maintenance tools and supplies, repair bills, homeowners’ association dues and more. It is critical that you allow room in your budget for all of the expenses related to home ownership to ensure that your new home is not only affordable but, for you, does not impact your lifestyle. Remember: You want to live IN your home, not FOR it!
Failing to Inquire About Closing Costs
Your mortgage representative is required to disclose all loan charges and fees to you early on in the loan process, so, don’t forget to take the time to thoroughly review or understand these fees. Many buyers are, unfortunately, surprised by the amount of money with which they must come to the Closing table at the end of the loan process. This can be avoided by simply asking questions and reviewing the preliminary loan statement up-front.
Each of these home mortgage mistakes can be costly to a Charlotte homebuyer. However, they also are all entirely avoidable. As you begin your loan process and proceed through it to Closing, keep these mistakes in mind. Be sure to ask your loan concierge for more information if you have any questions. You can begin the loan process today by contacting a lender directly and we are more than happy to provide you a list of Charlotte’s preferred mortgage lenders. Just give us a call at (704) 491-3310 or email us at SavvyBroker@me.com for our list.
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© Debe Maxwell | The Maxwell House Group Real Estate | SavvyBroker@me.com | 5 Huge Mortgage Mistakes Charlotte Homebuyers Make – and How to Avoid Them