Mortgage Broker Advice
First-Time Home Buyer? Here Are Some Expert Tips From A Mortgage Broker
Buying your first home can be a daunting experience. The most important aspect of it - securing a mortgage - is a complicated process that requires time, effort and plenty of due diligence; therefore it is no surprise that those purchasing a property for the first time can feel a little intimidated when it comes to obtaining a mortgage.
The solution? Use a mortgage broker. They take everything out of your hands and use their knowledge and expertise to help you make the right decisions and obtain the best deal possible.
Unfortunately, we can’t offer you the services of a mortgage broker as a reward for reading article (sorry!), but we have spoken to one and asked them for their top tips for first-time buyers - and we’re going to share them with you today.
Before we begin, however, if you’re based in Winnipeg and are on the hunt for a mortgage broker then we highly recommend the following website:
Expert Advice From A Mortgage Broker: First-Time Buyers
1) Credit score: Knowing your credit score is vitally important when trying to obtain a mortgage. Why? Because it can drastically impact upon how much you’ll pay back over the term of your mortgage. Having a credit score of 100 less than your current rating could result in paying tens of thousands of dollars more - something I’m sure that most people would want to avoid! So, rule number one is to keep a track on your credit score and be aware of how it may affect your mortgage options (speaking to a mortgage broker will undoubtedly help this).
2) Know your limits: Treat a mortgage like a credit limit, i.e. just because you have $xxx,xxx at your disposal doesn’t mean you should use absolutely every penny of it. Maxing out your budget for the sake of maxing out your budget is never a wise idea; it’s always best to play it safe and have some credit or cash in reserve just in case you ever need it.
3) Get a pre-approval: Having a pre-approval isn’t required prior to looking for your dream home, but as pre-approval is almost tantamount to getting the green light for a full-blown mortgage, it is a wise idea to obtain it. In addition, if the seller is aware that you’ve submitted a pre-approval alongside your offer, then this will show them that you are a serious buyer and have the requisite funds and/or collateral to complete the purchase. One point we must make here, however, is that a pre-approval and pre-qualification are very different beasts, i.e. the latter doesn’t carry anywhere near as much weight as the former (in reality a pre-qualification means very little indeed).
4) What down payment can you afford?: The standard down payment is around 20%; however, it is actually possible to get a regular mortgage with as little as 5% down payment. Even though it may seem like an obvious statement to make, the higher your down payment, the less your monthly repayments will be. However, that being said, don’t feel like having less than 20% will result in you not being able to obtain a mortgage; it is possible to own a home for much less than this amount.
…and there you have it folks - our mortgage broker’s top four tips for first-time buyers. There is, of course, far more to a getting a mortgage than the above four points, which is why we highly advise anyone searching for a first-time mortgage to discuss their options with a mortgage broker (it can’t hurt, right?!).
In the Winnipeg area? Check out the mortgage brokers above.
Thanks for dropping by!
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