If this is your first time buying a home, it's natural to feel overwhelmed by your to-do list. However, you'll get the best results by taking it one step at a time, starting with the mortgage process. If you haven't applied for a home loan yet, ensure the best rate by avoiding these typical pitfalls.

Common Errors People Make During the Mortgage Process

1. Not Knowing the Difference Between Qualification & Approval

Before putting in an offer on a home, it's crucial to get pre-approved for a mortgage loan. However, many first-time homebuyers mix up the meaning of "pre-qualification" and "pre-approval." While a qualified buyer might have promising credentials, only a pre-approved buyer has a green light from a lender. When you present a seller with a pre-approval letter, your odds of closing on the property will be higher.

2. Missing Out on a Rate Lock

When you pay back a mortgage in small fees each month, your lender will make money off of the interest rate you agreed to. For some loans, this rate can fluctuate, sometimes even between the day you were pre-approved and the day you closed on the house. Instead, opt for a rate lock to guarantee the rate will stay the same for those 30 to 60 days. It's best to implement the lock when interest rates are lowest, so you might need to get an opinion from a seasoned mortgage broker.

3. Putting It Off

Many first-time homebuyers are so eager to buy a property that they start looking at listings before organizing their finances. If you can't afford to purchase a home outright, you'll need to begin by preparing for the mortgage process. Months before applying for a home loan, start assessing your credit score, monthly budget, and income to debt ratio. Then, focus on saving for a down payment. Finally, head to a lender to get pre-approved for a mortgage loan before reaching out to a real estate agent.

If you’re looking for a mortgage broker who will help you avoid these mistakes, turn to IP Advisors in Mesa, AZ. This lending brokerage firm offers a wide variety of home loans, including VA and FHA mortgages. They can also offer assistance when you’re ready to refinance. To learn more about their brokers, visit them online. To set up a consultation today, call (480) 999-6353.