There are a lot of misconceptions about what it takes to get a mortgage in this market, particularly with buyers new to the mortgage process—and buying into those misconceptions can cost you a lot of time, energy, and, in some cases, money.
So what, exactly, are the most common mortgage misconceptions?
A recent article from realtor.com outlined some misconceptions many buyers have about securing a mortgage in this market, including:
- Applying for a mortgage is a quick and painless process. Getting your mortgage approved can be a long, drawn-out, and tedious process that can add weeks (or even months!) to your home purchase—particularly in this market, when many lenders are processing a high volume of applications. Anticipate that the process may take a while—and, on your end, do your best to speed things up by being as organized and timely as possible with your lender’s requests.
- You’re guaranteed to secure a low interest rate. Many lenders are still advertising crazy-low interest rates—but securing a rate like that typically takes near-perfect credit and a sizeable down payment. When applying for a mortgage, make sure you have realistic expectations around interest—and don’t waste time looking at houses that are out of your price range based on the idea that you’ll get a low interest rate.
- You don’t have to pay anything out-of-pocket to get a mortgage. Most mortgages have a variety of upfront fees and costs (like closing costs)—so, if you’re applying for a mortgage, make sure you set cash aside to cover those out-of-pocket expenses.