Beginning the mortgage application process can feel overwhelming for any first time home buyer. So, to help you get started, your local mortgage broker, Gert Martens with Dominion Lending Centres, has listed 5 things every broker wishes you knew before starting the mortgage process.
#1: Don’t Quit Your Current Job
Most brokers prefer their clients to be with their current employer for at least two years. This is so the broker knows they have a stable income and can afford to make payments towards their mortgage every month. So, to avoid your application being denied, make sure you stay at your current job until after you have closed on your home.
#2: Know The Rules On Making A Down Payment
To qualify for a mortgage, you will need to pay at least 5% towards your down payment. A down payment is a certain percentage of your home’s overall value price and is due before you can close on your home. If you pay less than 20%, however, you will be required to pay for mortgage default insurance. This insurance is so the broker is protected in case the borrower fails to make a payment.
#3: Contact Your Broker For Everything
Your mortgage broker should be your main source of contact for everything. They are here to help assist you in the mortgage decision process and they can answer any questions you may have.
#4: Avoid Additional Large Purchases
Most new homeowners feel that since their house is new than everything else they own should be new too. However, you should avoid making additional large purchases during the application process. Your credit score largely impacts how much you will be able to borrow and what type of mortgage you could qualify for. Every time you make a large purchase, your credit score could be affected, which could ultimately impact the approval of your application. So, to avoid this from happening, try not to make any additional large purchases until after your mortgage has been approved and signed for.
#5: Be Organized With Your Finances
Owning a home is a major financial commitment, so make sure you are organized with your finances and have enough money in your savings to make payments on time every month. Also, be sure to review your current credit report so you can dispute any inaccuracies before you begin your application.
For more information on things your mortgage broker wishes you knew or if you are interested in getting started on your application, please contact Gert Martens with Dominion Lending Centre at 780-933-0109.