Before you start to approach local banks and other financial institutions with the aim of obtaining a mortgage to buy a new home, there are a few facts that you need to know. Borrowing such a large sum of money without doing some research first is not a good idea as you will be entering into a binding contract that lasts for many years. With this in mind, below is a list of 10 things you really ought to know before you apply for your first mortgage, which should stand you in good stead when you get in touch with local lenders.
10 Things You Should Know Before Applying for a Home Loan
Make a note of the following ten points, or bookmark this page so that you can refer to it whenever you want.
1. Your Credit Score – Your credit score and history will dictate the rate of interest you are likely to be charged on a mortgage so the first thing you need it know is what kind of score you currently have.
2. Your Budget – What a bank or mortgage broker thinks you can afford and what you can really afford are often two completely different things. Go through your budget carefully to make sure you do not overextend yourself.
3. Your Partner – This may sound like an odd one but if you are getting a joint mortgage, you need to be absolutely sure that your partner is 100% reliable.
4. Your Building Company – If you are paying a Perth builder to create a beautiful new home for you, take the time to get to know how they work before you sign on the dotted line. If you click here, you can get a good idea of what reputable firms have to offer.
5. Possible Benefits – Depending on where you are in the country and the current regulations, there may well be certain government schemes for which you are eligible, which could help to defray the cost of your new home.
6. Your Location – The location of your new home will have a major influence on its future value so research this particular factor very thoroughly.
7. Your Future Plans – Given the long-term nature of mortgages and the fact it may take some time before you can sell your new home for a profit, you need to consider your future plans carefully.
8. Your Lender – Although it is tempting to make all the arrangements online, you should visit the bank from which you are going to borrow, to make sure you are happy with their terms and conditions.
9. The Fees – Virtually all Mortgage Providers charge application fees, and there may be other costs involved in dealing with them too. Make sure you are aware of them all up front.
10. The Real Value – Pay for an independent valuation of the house you wish to buy.
There are other things you should know but the list above will get you off to a great start when applying for home loans in Western Australia and elsewhere.