As a mortgage broker, I see a lot of first-time home buyers. Because of this, I notice some of the top first-time home buyer mistakes people make when purchasing their first place. I thought I would share with you these mistakes in hopes that you would be able to bypass them.
I will never stop talking about the fact that people should be using a mortgage broker instead of just going directly to a bank. So many people don’t know that for traditional mortgages, using a mortgage broker doesn’t cost the home buyer a cent – and it’s quite possible that working with one will actually save you money in the long run.
Let me explain.
When you go to your bank, the mortgage specialist that you see is simply that, a specialist. This person doesn’t have to have a mortgage license. They also only represent the products their financial institution offers.
This means that they can offer you one lender’s rates and one lender’s rates only.
When you work with a mortgage broker, I am a licensed broker. A broker has to receive their license and renew it every two years. In addition to being licenced, a broker has access to several of the main financial institutions plus many other broker specific lenders.
This means that I am able to shop around the different banks to find the best rate and product possible for you.
If you were to use a mortgage specialist at a bank, they only have access to their institution’s rates and are not able to shop around for the best rates coming from other banks.
If you want to learn more about broker vs bank, you can check out my article “Broker vs Bank – Who to Choose.”
I always suggest that a first-time home buyer reach out to a broker. There are also specific first-time home buyer programs and benefits that some banks may not mention to you.
Has anyone ever told you never to go grocery shopping while hungry? It’s kind of the same thing with house shopping but it’s to never go house shopping without coming up with a plan beforehand.
It’s very important to go house shopping with a plan in mind. Know your budget, know what you’re looking for and know what you can actually afford. You don’t want to see a home that is completely out of your budget, but you love it. If this happens, homes within your range may pail in comparison and the whole house buying journey may become more stressful and less enjoyable.
My best advice is to reach out to a broker first. Do a pre-approval to know what you can afford to purchase. Then come up with a list of things you want your home to have and then take that to your realtor.
Know that homes come up for sale all of the time and if you miss out on one that you really like, another one that you love will come along.
My final mistake plays off mistake #2. When you don’t know your limit, you think anything is possible and any home is possible. Sadly this isn’t the case.
I’ve had several clients come to me with an accepted offer on a home that they simply don’t qualify for. It’s a sad part of my job explaining to a client that there isn’t a way possible to make the home of their dreams work for them.
The best bet is to know your limit before you begin to look at houses to understand what homes are actually possible for you!
Know what price point you qualify for, know whether or not you’re going to need/get a co-signer, know your down payment amount, know the yearly property tax amounts you will have to spend for that home.
All of this knowledge will allow for a smoother process on both your end and mine.
If we are able to find a way to make an approval happen, you have to ensure that you are able to afford these payments. You don’t want to sacrifice your whole life to be able to afford your monthly mortgage payments. And, eventually, if those payments aren’t able to be paid, your lender would reach out to you and let you know your options.
We don’t want it to come to that, so please reach out to me first and let’s find out your limit!
Mistakes happen but these first time home buyer mistakes can be avoided if you reach out and work with me. We will go over your situation, pre-approve you and find the best mortgage program for your needs.
There are so many benefits when you work with a mortgage broker one-on-one. Let me show you how seamless the mortgage process can be with Mortgage Okanagan!
Give me a call at 250-826-3111, fill out my pre-approval application or use my contact form and I’ll get back to you too.
Let’s get your application off the ground.
