Making bad decisions around your mortgage can easily end up costing you thousands of dollars, something I’m sure you don’t want to happen! If that’s the case, take a look at these common mortgage mistakes and avoid making them yourself when the time comes for you to get a home loan…
Not Using an Independent Mortgage Broker
Using an independent mortgage broker like Brighter Finance is the only way to get the best deal available to you. Why? Because an independent mortgage broker doesn’t have any affiliations with any one bank or lender, which means they will work to find the deal that represents the most value to you.
Not Having your Commission Refunded
Getting the commission you pay refunded after paying for mortgage advice is one of the simplest ways to recoup sometimes tens of thousands of dollars, but so many people aren’t aware of or simply don’t bother to use this strategy.
Basically, when your mortgage broker arranges a loan, they will immediately receive a commission which represents a small percentage of your property’s worth. They will then receive an additional, smaller commision each year. This could be enough to persuade the broker to push you in a specific direction. To avoid that, try to choose a broker who is open to refunding your annual commission after the initial payment.
Keeping the Same Mortgage
If you take out a home loan with one company and stay with them no matter what until you’ve paid your mortgage off, chances are you will end up paying way more than you need to overall. At least every couple of years, you should reevaluate your situation and see if there is a better deal to be had. Most of the time, there will be, and you’ll save thousands as a result.
You Choose the Longest Loan Term Possible
It’s tempting to give yourself as much time as possible to pay off your home loan, but actually, setting the term just a few years shorter could save you tens, sometimes even hundreds of thousands of dollars by lowering the amount of interest you are required to pay. Obviously, you need to set your term to be long enough that you can actually pay it off comfortably, but don’t make the mistake of extending it longer than you really need to.
Using Rating Websites to Choose a Lender
It’s always a good idea to have a look at lender ratings online, but you shouldn’t use sites like Canstar.com to make your ultimate decision because no everything you see online is accurate and you might end up paying more. You need to do more research before you sign anything if you really want to get the best deals.
Only Thinking About the Interest Rate
If you choose your mortgage based only on the interest rate but do not take into account things like application fees, rate lock fees, establishment fees and discharge fees, you could end up paying more than you would have choosing a mortgage that had a slightly higher interest rate. Make sure you check all of the fees before you proceed.
I hope this helps you pay less for the perfect home!