Common Mistakes New Home Buyers Make When Obtaining A Mortgage
When you are a first-time buyer venturing into the market for a new home, you are so busy focusing on different elements of the house that obtaining a mortgage takes a back seat. However, educating yourself about a mortgage is a crucial step in the home-buying process.
As a new home buyer, you may hold preconceived notions about mortgages and assume that qualifying for a bank loan is simple and straightforward. Unfortunately, a lack of information coupled with stringent mortgage guidelines and other factors could put you in an unpleasant debt situation.
At Mortgages By Neetu Dhillon, I make the process of obtaining a mortgage as stress-free as possible and to help you avoid making a costly mistake, I have compiled this list of common mistakes made by new home buyers when shopping for a mortgage.
1. Shopping for a home without getting pre-qualified for a mortgage. Buying a home is such an exciting time for anyone and most of the time, people enter the real estate search without knowing how much they qualify for which can sometimes end in disappointment. The best way to begin house hunting is to find out what you are eligible for through a mortgage professional. This will make the house hunting process more relaxed and enjoyable.
2. Not aware of all the benefits you get as a first-time home buyer. A lot of times, I see new home buyers are so excited to buy the first place that they don’t take the time to learn how to use all the perks that come with buying their new house. At Mortgages By Neetu Dhillon, I sit with you and show you how to save money on property transfer tax as well as the rebates that are available to you.
3. Buying a house that is too big and too expensive. Many times, people only look at the mortgage payment that they will be taking on as a new homeowner. However, owning a home comes with several responsibilities. Once you become a homeowner, many bill payments come along that you may not have had as a tenant such as the hydro bill, cable bill, utility bill and property tax. My job is to show my clients the bigger picture and to make sure they can afford the payments and live the lifestyle that they want.
4. Not maintaining your current credit. Your credit plays a significant role when qualifying for a mortgage. Your credit history and pattern ensures the lender that you are a responsible credit seeker who pays the mortgage payments on time. From time to time, I notice clients that have not maintained their credit due to various issues, and once they enter the house ownership market, it becomes difficult for them to get financing. At Mortgages By Neetu Dhillon, I take pride in coaching my clients on how to maintain their credit and work with them closely until they are ready to buy.
5. Making a big purchase before buying a house. Quite often, I see clients purchasing a new car or leasing it with a big monthly payment. When qualifying for a mortgage, the auto loans or leases play a major role in your debt ratios which sometimes doesn’t qualify you for your dream home. When you are in the market to buy a house, always buy your dream home first and then bring the car home to showcase in your brand new garage.
6. Not considering your employment history. It is natural that we all want to do better than yesterday and the same comes down to our job. People sometimes keep moving from one job to another. When seeking financing for a mortgage, your employment history has to make sense to the lender. If the lender sees you jumping from one position to the other, it is often thought that you are not a stable worker. But if you have moved within the same industry for better pay or opportunity, the lender is okay with that. So, if you are thinking about buying, make sure you have credible employment history.
For the best mortgage broker in Surrey, BC, reach out to Mortgages By Neetu Dhillon. I specialize in providing residential, commercial, refinance and private mortgages to clients across Surrey, Chilliwack, Langley, Delta, Vancouver, Burnaby, Coquitlam, and New Westminster. I negotiate and find the best rates and services for clients.
To learn more about all the services I provide, please click here. If you have any questions about how I can help you, I’d love to hear from you. Please contact me here.