Buying a home can be overwhelming, especially if it’s your first home, and you’ve no experience, therefore you’re more susceptible to the pitfalls of the mortgage process. It’s also common to stumble along the way if you’re not a first-time buyer, after all, buying a house is one of life’s biggest events.
As a specialist mortgage advisor in Manchester, our team here at TaylorMade thought it would be helpful to pull together the most common mortgage mistakes we come across so that, hopefully, you can avoid them and make your mortgage process relatively plain sailing.
7 Common Mortgage Mistakes and How to Avoid Them.
Below are the most frequent mortgage mistakes we come across or the most frequent snippets of advice we hand out to our customers. Hopefully, by reading these, you can make smarter decisions and avoid any added stress to your home-buying journey.
Avoid House Shopping Before Understanding Your Affordability.
When you start shopping for your dream home, you can be filled with equal parts excitement and disappointment; this is because houses are snapped up fast, and all buyers will be in different positions when it comes to buying. Use an affordability calculator to determine a realistic budget or, even better, contact a mortgage advisor who can help you understand what your finances can afford and reduce the chance of disappointment.
Avoid Applying for a Mortgage Without Checking Your Credit Report First.
Your credit score and history play a big part in determining how reliable you are to lenders and how much they are willing to lend, as well as your mortgage rates and terms. Checking your credit score beforehand gives you a good idea of where you stand and avoids any nasty shocks when it comes to a final amount. Ensuring that your credit report is correct and up to date is also helpful and if there are any errors, contact your credit reporting agency to ensure the information is changed.
Avoid House Hunting Before Getting a Decision in Principle.
It’s essential that you get a decision or agreement in principle (DIP/ AIP) before looking at houses, as without these certificates, you have no idea how much a lender is willing to give to you. Therefore, you may be looking at houses that are way over your budget. Having a DIP or AIP also signals that you’re a serious buyer and further along in the mortgage process.
Avoid Underestimating the Cost of Homeownership.
It would be foolish to think that homeownership consists of just mortgage payments and the initial deposit, the costs of running a home are ongoing and frequently fluctuate. In order to determine how much to lend, lenders use strict tests to assess your total monthly outgoings, including utility bills, insurance, maintenance, and any potential renovations.
Avoid Taking Out Credit Before Applying for a Mortgage.
Lenders closely examine your credit score and history and look closely at your debt-to-income ratio; these things affect your mortgage approval chances. So, avoid taking on any new debt before applying for a mortgage if possible and wait until after your mortgage is approved before considering additional credit.
Avoid Skipping Home Inspections to Save Money.
It’s true that this important step in the mortgage process is costly, and you could save money in the short term if you don’t pay for them straight away. However, this small expense could turn into something more serious like leaky plumbing, damp issues, getting rid of termites, etc., all of which will more than likely be more expensive than if you have spent the money on a house inspection in the first place.
Avoid Scrimping on the Money Needed for Additional Fees.
Solicitor fees, surveyor fees, and other professional fees can mount up quickly, so ensuring that you have enough funds to cover these costs is vital to avoid financial strain and potential delays during the home-buying process. Being financially responsible, understanding affordability, and planning ahead are keys to a stress—free life and buying experience.
Get the Essential Guidance You Need from a Specialist Mortgage Broker in Manchester.
Here at TaylorMade we are equipped with a team of specialists with the expertise and know-how to help you through the entire process, from mortgage application through to completion. We are an independent mortgage broker in Manchester, operating all over the UK with the ability to compare hundreds of mortgage deals across the market.
Contact your specialist mortgage broker today!
