You’ve finally decided to become a homeowner, one of the most significant Financial steps you’ll take. But you’re not familiar with this financial territory, and the process might seem intimidating.

If you’re considering purchasing it without a financial consultant, a broker to be more specific, you may end up with an expensive loan, a longer closing process, buyer’s remorse, or even rejection of your Mortgage.

Without the proper information not only about mortgage products but of your own financial standing, you might end up paying more than you expected. This is why it’s always better to leave it to a trusted mortgage broker to make the process as stress-free as possible for you.

To help you avoid some basic mistakes that could prove to be costly, here’s a list of the most common mistakes people make when financing property.

1 Ignoring the true cost of ownership. When determining whether or not you can afford a home, some people make the mistake of doing things such as comparing their rent to their mortgage payment. The cost of home ownership goes beyond your mortgage payment and includes items such as repairs, property taxes, and insurance. Failing to set a budget that accounts for this can set you up to be house poor, so be sure to plan a budget that leaves you some room after your mortgage payments.

2 Adding too much debt. Many people want to get a new car or furniture set to go along with their new home. However, this could backfire because it can raise your debt-to-income ratio and lead to you no longer qualifying for the house if you buy those new items. Avoid adding debt before closing and postpone making these purchases until after you have closed your mortgage. If you must take out Credit or make a large purchase before closing your mortgage, make sure to consult your agent first.

3 Getting pre-qualified but not pre-approved. Getting pre-qualified involves providing your lender or bank with your financial circumstances based on your income, assets, and debt. This gives you an idea of how much you can expect to be approved for. However, since it does not include things like your credit report and financial history, the number that you receive in pre-qualification is not a sure thing. Pre-approval goes more in-depth by reviewing your credit report and conducting extensive financial background research. Getting both, a pre-qualification and a pre-approval, will give you a better idea of what you can afford and gives you more of an idea when you make your offer. This shows that you are a more serious buyer, who knows that they can receive appropriate financing for the home.

4 Poor credit score. Having poor credit not only makes it more difficult to qualify for a mortgage, but you could also be subjected to a much higher interest rate or a larger down payment. The habit of not honoring your financial commitments on time will end up costing you thousands in preventable interest payments. If you want to qualify for the best rates, pay your bills on time and don’t max out your credit facilities.

5 Not using a broker. Yes, we are well aware how this sounds, but the truth is the truth. Brokers (like us) have the experience and expertise to track down the most affordable mortgage deals available to you. We can also help out with your application, making sure that none of the above factors become a problem for you. Our interest is in the successful purchase of your property, and our step-by-step guide to the mortgage application process will leave you feeling more empowered for future investments/purchases. In most cases, using a broker will actually save you money in the long run.

To avoid these and other mistakes, reach out to the experts at Avon Financial, the best mortgage service in Brampton, ON. With our professional mortgage service and expert advice, you end up getting a mortgage that’s right for you – not just the one a lender wants you to sign. We offer in-depth knowledge, provide detailed analysis and simplify the whole process for our clients. We deal with first time home buyers, refinancing, mortgage renewals, debt consolidation, line of credit and second mortgages. For a complete list of services, please click here. If you have any questions about mortgages, we’d love to hear from you. Please contact us here.

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