Mortgage Mistakes to Avoid

The purchase of a home is, in most cases, one of the biggest purchases in a person’s life. So many details go into that purchase, or the refinance of that purchase, beginning with getting approved for that mortgage or refinance. According to Forbes.com, analysis from financial data firm Black Knight shows the latest drop in mortgage rates opens the door for more than 11.3 million homeowners to refinance. There are actions you can take right now to educate yourself on what you can do to make sure that pre-approval transaction goes smoothly.

“In my experience, people wait too long to get their pre-approval,” said Ed Moloney of Equity Resources, Inc., in Falmouth, “For example, they’re living in an apartment and, all of a sudden, the landlord says he’s decided to sell. Or, they say they don’t plan on buying for three years, and decide they don’t need a pre-approval anytime soon. Big mistake! Meet with me or meet with another mortgage professional and get educated.”

First, Moloney said, you don’t know what’s on your credit bureau, or if there’s a medical collection listed there. You can pull your own credit bureau report with no pull against you. Doing this early on, before you’re ready to buy, will allow you the opportunity to go over it with a professional, and address sooner rather than later any issues that appear and may affect your ability to get that pre-approval.

Moloney also suggests a potential buyer have an in-advance meeting with a mortgage professional to discuss debt to income. This will help you understand how much you earn versus how much you owe, or how much you might owe down the road. Understanding these aspects will give you an idea of what you can afford, your timeline and of course, what that estimated mortgage payment will be. Some actions steps may be required before you’re able to buy. Moloney and his team can help guide you to homeownership by reviewing your situation.

Another mistake people make is assuming that they should pay off and cancel all their credit cards. “No, no, no,” Moloney emphasized. “Put them in a drawer. Don’t use them. Only use one or two. Keep the credit open. Also, make sure you’re timely on your payments.”

Other factors, he said, like self-employment or depreciation of equipment, are all things that need to be taken into consideration. There are many details to think about in advance, details only a professional may recognize.

“That’s why I think the biggest mistake is that people don’t plan ahead, or they live in fear and put their head in the sand. Your credit is never going to get better until you take a step. You may think, ‘I’m embarrassed’ or ‘I don’t think there’s a possibility (of getting a mortgage).’ There’s ALWAYS a possibility. I believe home ownership is attainable for everybody with time and a plan. But if you don’t start with a plan, forget about it.”

What about the person who’s been a homeowner multiple times? How can you serve that person well if they already have established contacts and are satisfied working with them? According to Moloney, the devil is in the details, including specialized attention that bigger banks and finance organizations can’t provide.

“If they’re working with local banks, they may not get a call back on a weekend when they need a revised pre-approval then and there,” Moloney said. “I assure realtors and potential clients of who we are, that we’re strong, and what my background is.”

People often get bogged down in their quest to find the lowest rate. And while the rate is important, Moloney said, it’s not the only item to be considered when shopping for a mortgage. It’s important to understand what drives the rate – the market, your credit score and your loan-to-value.
“The reality is, I’ve done pre-approvals for some clients in an hour, and they’re in great shape. Planning really is key. But let me be clear – if you didn’t plan, it doesn’t mean don’t call.” If you need something today, Moloney said, he’s here to try to get it for you.

Bottom line – If you are renting today, and you don’t want to rent forever, start a communication now, he said. Then, all the pieces will come together.

Learn more about Edward Moloney and Equity Resources at www.callequitymortgages.com/ed-moloney.

Edward Moloney
Equity Resources, Inc.
465 E Falmouth Hwy Ste B, East Falmouth, MA 02536
(774) 573-0329
Corporate NMLS: 1579, Edward Moloney NMLS: 10321

Sponsored Content

About Ann Luongo

Ann Luongo is the Marketing Writer and Lifestyle Reporter for CapeCod.com, and has been writing for Cape Cod and South Shore publications for over 15 years.



CapeCod.com
737 West Main Street
Hyannis, MA 02601
Contact Us | Advertise Terms of Use 
Employment and EEO | Privacy