Mistakes House Buyers Make – pret hypothecaires

Buying a house has always been a complicated and serious matter and for a lot of people, outside of marriage, career and having a family, it is the biggest life decision they will make. Trying to avoid mistakes in this area is always a good idea. What are the most common of these mistakes?

1. Have friends or relatives temporarily put funds in your account to increase the balance. Some people seem to feel that having a more money in their bank account will boost their credit rating, but credit agencies do not use this as criteria. Banks only want to know how much you are going to put as a deposit and you have to not only show it in the account, but use it as the down payment!

2. Losing a desirable house because you haven’t closed on your existing property. If you have a contract on the sale of your home, and you have found the perfect new home and don’t want to lose it, you may be able to get a bridge loan from your lender.

3. Assume a mortgage. This is a big temptation since frequently the existing mortgage has a lower rate than the current market rates or if the buyer thinks he cannot get approved by a bank. If the mortgage is a conventional one, the terms usually call for the mortgage to be repaid upon transference of the title of the property. VA and some FHA loans are assumable, but the new borrower has to meet the bank’s credit criteria anyway.

4. Insisting on more house than you can afford. A common mistake many people commit is to overextend themselves when they buy a house, thinking that between the buildup in equity and the increased value, they will be richer in the long run. Mortgages are designed to pay the interest part of the loan before the equity portion, so in the beginning of a mortgage, very little equity is paid off – pret hypothecaires. Since today’s market no longer allows us to count on continually rising home prices, chances are that the investment in the home will not appreciate dramatically.

5. Looking for a home without knowing how much house you can afford. You will wear down a lot of shoe leather if you decide upon this route. Before you start the home search process, you should arrange a consultation with a mortgage broker to apply for a mortgage and, if possible, get a mortgage pre-approval letter. If you are not going to be in a position to get a loan, looking at homes may just be a nice way to spend the day – taux hypothecaire quebec.

Real changes have occurred in the housing market recently, and buyers cannot assume that what applied in the past will work today. Home prices are no longer escalating, mortgages are much more hard to secure and lenders are wise to any of the tricks that unqualified buyers may try.

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