As a first-time homebuyer, you will probably get excited more frequently than others. If you are a novice investor, this is a trait that you should learn how to control. When you are trying to obtain a loan, you must be calm and composed. You do not wish to make any critical mistakes that mess up your finances for good. The following section explains some of the most common and critical yet avoidable mistakes that new home buyers tend to make around the city. Let’s understand what they are:
- Accepting The First Offer Is Not Acceptable
Are you focusing on just one lender? Has that bank or financial institution floored you with their terms? Every bank is out there to compete for your business. A prudent borrower is one who does not fall for the first offer. Do not make the mistake of accepting the first loan that looks favorable.
- Are You Having Credit Issues?
If you have any credit issues, it is essential that you come clean with them. Any lender is going to perform a credit check on you. The biggest key here is how well you are able to communicate about your credit score and overall credibility with your lender. It is possible to procure credit despite having serious issues in your credit history. It is all about how you are able to portray yourself and your finances in a positive light.
- Where Is the Liquidity?
You will have to understand what banks and various other Mortgage Lenders in Portland Oregon prefer to see on your financial statements. As a borrower, you will have to put down something as collateral or security. This is where a bank would consider you a borrower with minimum risk. If you are not able to show that you are liquid enough, your loan application might get rejected.
- Not Comparing Your Loans
So, let’s assume that everything has worked out in your favor. Several banks and financial institutions have agreed to lend you credit. What should be your next step? You should make time to compare your offers from multiple lenders. Whether it is the rate of interest, repayment tenure, the amount of loan, processing charges, or any other aspect, you must make comparisons with an alert mind. If you think that the lender with the lowest rate of interest suits you the best, choose them. If the loan tenure matters to you the most, pick the lender that fits the bill.
- Forgetting about Loan Affordability
In the end, it is all going to boil down to the affordability of the credit you obtain. This is where the monthly repayment comes into play. Any lender is going to factor in your capacity to repay the entire loan amount within the stipulated loan tenure. If you can ensure your total repayment obligation, the lender will be more than forthcoming to lend you credit. As a loan applicant, you can try to reduce your obligation to repay by prepaying a significant portion of your existing mortgage. You can also opt for a longer home loan repayment tenure. Avoiding or neglecting this step is going to cost you heavily.
Your finances are your personal business. But when you are out there in the market, seeking a loan or mortgage, things change a little. You have to be proactive and more diligent with your finances, especially when you are in the process of acquiring a loan.