Common Mistakes When Getting A Mortgage

Mortgage and Lending with JB Mortgage Capital, Inc. NMLS# 247447

Here are six common mistakes to avoid when seeking mortgage in California.

Mistake #1:

Searching for home in California prior to getting approved. It is essential you are pre-approved PRIOR to looking for a home so you know how much you can not only afford but qualify for. And during this process you'll find out if you qualify for the California 2021 Conforming loan limits.   

With a full mortgage home loan pre-approval, you are also more likely to have your offer accepted by the seller. Without pre-approval, the seller doesn't know if you'll get approval from a lender hence they are likely to consider you offer less seriously. 

Mistake #2:

Employment change. Any lender will prefer mortgage applicants to have steady employment history. With consistent monthly income you'll be in a better position to get approved. Avoid changing jobs prior to completing the new loan.

Mistake #3:

Not locking the mortgage rate: Daily changes are common with mortgage rates, if not multiple times a day. Your lender may offer you several quotes to chose from in terms of how to structure the loan however until the quote is locked, it remains a mere quote. Once your rate is locked-in, you can focus on more important areas of the transaction.

Mistake #4:

Exploring available options: Shop around and see not only who has a low rate but also see who will provide excellent customer service. Take your time to learn about the differences between FHA mortgage loans, VA home loans and conforming loans. The more you know the more likely you'll obtain a low mortgage rate at great terms. Additional things you'll want to learn about include PMI and MI (Private Mortgage Insurance and Mortgage Insurance) if you are putting less than 20% down. Loan To Value ratio and Debt To Income ratio are also important terms you should learn.

Mistake #5:

Applying for new debt: This is a big no, no! Mortgage lenders qualify you based on your income and the debt you currently have. Applying for more debt will nullify the approval and the file will go back to underwriting for a full review. So until the loan has closed and recorded with the county do not apply for any new debt without first speaking to your Loan Officer.

Mistake #6:

If you're buying a home, not going through the fine print: The buyer has the responsibility to go through the terms mentioned in the mortgage, understand it clearly and accept it. Without proper understanding of the purchase contract you run the risk of agreeing to something you may not want to agree to. Make sure you take the time to review the purchase contract with your Realtor and discuss it with your Loan Officer as well.

Comments (1)

Will Hamm
Hamm Homes - Aurora, CO
"Where There's a Will, There's a Way!"

Hello Kevin and so True with your Mistakes that buyers make.  Can I reblog this sometime?


Nov 24, 2020 08:16 AM