Smart advice for your mortgage success
Mortgage Tips
Before Applying for a Mortgage
1. Get pre-approved early for a mortgage. A pre-approved mortgage shows sellers you’re serious about homeownership, clarifies your budget, and can strengthen your offers in competitive markets.
2. Know your credit score (and what affects it). Small changes—like paying down credit cards or avoiding new debt—can improve rates on your loan options.
3. Save beyond the down payment. Be prepared for the homeownership costs that come with closing costs, inspections, appraisals, and moving expenses, which often surprise buyers.
4. Avoid major financial changes. New cars, job changes, or opening credit accounts can delay or derail your mortgage approval.
Understanding Loan Options
5. Compare loan options—not just rates. Fixed vs. adjustable, FHA vs. conventional, and term length all impact monthly payments and overall homeownership costs.
6. Ask about the total loan cost, not just the interest rate. Fees, points, and mortgage insurance can significantly change affordability and influence your decision on loan options.
7. Understand your mortgage insurance options. PMI, MIP, and lender-paid options each have pros and cons depending on your down payment and credit, so it's important to consider these when seeking a pre-approved mortgage.
During the Process
8. Respond quickly to document requests Delays often happen because paperwork isn’t submitted promptly. Staying on top of these requests can help you manage homeownership costs more effectively.
9. Keep finances “steady” until closing Don’t move large sums of money without checking with your lender first. This is crucial to ensure your loan options remain intact and your pre-approved mortgage stays secure.
10. Review the Loan Estimate carefully Encourage clients to ask questions about anything they don’t understand, especially regarding potential homeownership costs and the specifics of their loan options.
After Closing
11. Plan for homeownership costs, including maintenance, taxes, insurance, and utilities, as these should be part of your budget for a successful transition to owning a home.
12. Revisit your loan options over time; if rates drop or your income changes, considering refinancing or recasting your pre-approved mortgage may make sense.