Shop and compare at least three lenders before deciding which one is the right one for you. Look at interest rates, fees, costs, and APRs to compare each lender very carefully before making a final decision.
Word to the wise, though, in order to make a true comparison, you have to compare the same type of loan at one lender with the same type of loan at another lender. (You have to compare a 5-year ARM to a 5-year ARM. You can’t compare a 5-year ARM at one lender to a 15-year fixed rate mortgage at another lender.)
7. Failing to Negotiate
Take a long hard look at the fees the lender is charging you and don’t be afraid to negotiate away what are known in the industry as “junk fees.” Junk fees can be anything from an application fee (that is not credited back to you at closing), sign-up fee, or document prep fee to messenger and faxing fees.
If you see a fee that seems out of the ordinary (especially ones that you aren’t seeing from lender to lender when comparison shopping) question it. If it seems like a junk fee, let the lender know that you aren’t going to pay it or that they need to reduce it (negotiate the fee).
What you see doesn’t necessarily have to be what you get (or in this case, what you pay).
Obtaining a mortgage is a big step. There are a lot of working parts to finding, qualifying for, and establishing a mortgage. Avoid making these seven mistakes and you’re at least starting out on the right path.
Mortgage holders, what mistakes have you learned from with your mortgage that you’d like to share with our other readers? Post them in the comments below!