A bad mortgage is often overlooked with one’s excitement to home ownership. Remember that there will always be people who will take advantage of your immediate needs.
Without carefully looking for the essential details, you can be a victim of a home loan company’s fraudulent activity. So before settling, look out for these 4 warning signs of a bad mortgage.
1. Pressure You to Take an Expensive Loan
Just because you qualify for an amount doesn’t mean you have to spend the entire budget on a home purchase. Informed home buyers shop within their budget to avoid becoming cash poor. There will always be houses for sale, so there’s no need to rush. It’s recommended to seek help from a professional mortgage broker to help with your approval.
Under no circumstance that you’re required to spend more for a house than you can afford,
regardless of what you’ve been promised. When you’re pushed to take bigger loans, stop the negotiations. Just remember the bigger the loan amount, the higher the monthly payments.
2. Force You to Sign Blank Forms
A bad mortgage lending company could fill in additional terms and conditions that could manipulate your loan. Always try to fill out all the needed information when you’re given a form. Leave no blanks unsigned or better yet cross them out and then initial. If you feel coerced into signing mortgage documents, you should seek legal advice.
3. Interest Rate is Too Good to Be True
Lenders know that many people look for the lowest interest rates possible. It can sound perfect at first, but it could be a marketing trick. The rates posted can be a short term adjustable-rate mortgage that may not be the most financially savvy option for you.
4. Fees and Terms Unexpectedly Change at Closing
One set of agreements during your application and then another at closing is called a bait-and-switch. Generally, not all of the fees will be revealed until you’re about to sign the loan. Beware of lenders who don’t deliver what was promised.
Ask your broker to clarify the breakdown of fees right before signing any documents. Carefully read the fine print.
Get Help from a Professional Mortgage Broker
In this digital age, many home buyers think that things are more accessible in just a few clicks. A lot of sites are available where you’re told that you can go at it alone.
But, we are talking about hundreds of thousands of dollars here. Getting a mortgage is the most significant debt you’ll ever acquire. Even a simple mistake can be very costly. Spotting a bad mortgage can be difficult if you’re not informed, so you’ll need someone who knows and understands the ins and outs of a mortgage.
Daisy Raouph, CLU, CHS, specializes in mortgage financing solutions and financial services. A Mortgage Broker and Financial Security Advisor with over 30 years of experience in financial services. Contact us today to review your mortgage financing options. We can help!