11 mortgage mistakes that most people make

DEC 13, 2017 AT 01:48 AM

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3. You are too positive about your budget

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If you never account for your money, you won’t be successful in dealing with any banking products. Mortgage is a long-term commitment, so you need to be realistic with all accounting actions. Look at how much money you’ve been saving monthly over the last one year. That’s the real amount of money you can afford to pay for a loan.

If you plan to allocate 90% of your income on mortgage so as to repay the loan within the shortest time possible, then such a plan is unreal. And this is the number one mistake that young families with no solid experience in domestic budgeting make.

 

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Do you have spare 150 000 $ in your pocket? This is the amount of money one can easily overpay after taking the wrong kind of loan. Mortgage has both its good and bad sides. It allows us to acquire and live in our own house and stop paying rent every month.

4. You trust your broker too much

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Mortgage brokers aren’t your best friends. The first thing you need to do is to personally check major offers for mortgage in local banks. It’s possible that you won’t require a separate broker to access such mortgage which can save you about 1-2% of the loan amount.

Usually, brokers tend to recommend to their clients those mortgages which pay the highest reward percentages. So, these guys won’t put your budget into consideration. Moreover, banks will make their interest rates a little bit higher because they need to pay the broker monthly or yearly. Therefore, it is a great idea to deal with banks directly with no middlemen at all.

 

ADVERTISEMENT

Do you have spare 150 000 $ in your pocket? This is the amount of money one can easily overpay after taking the wrong kind of loan. Mortgage has both its good and bad sides. It allows us to acquire and live in our own house and stop paying rent every month.