Buying/Selling Tips

Mistake #3 – Choosing the Wrong Mortgage

Twenty-one percent of customers purchasing a home regret their choice of a lender, according to the J.D. Power 2016 U.S. Primary Mortgage Origination Satisfaction Study, based on responses from more than 5,000 consumers. When it comes to first-time buyers, 27 percent say they regret their choice.

One reason for customers’ regret overall is a poor experience, including a lack of communication and unmet promises.

Some buyers also said they felt pressured to choose a particular mortgage product, and they made up their mind due to financial reasons, such as a lower rate offered. As a result, dissatisfaction with the mortgage process doesn’t necessarily mean it cost these borrowers more money.

Here are 3 tips to help borrowers with their search for the right mortgage that will guarantee satisfaction:

Due diligence on the Mortgage Lender/Broker

  • How many years in the business?
  • Ask for references
  • Where did he/she go to college? What was their major?

Ask about your affordability

  • Do I have good enough credit to get a loan?
  • How much money do I need for a down payment?
  • How much do I need for closing costs?
  • How much can I afford per month?
  • How much are property taxes and insurance?
  • Do I want to live in this house for a long term or short term?
  • If I get an adjustable loan, can I afford the maximum payment when it adjusts?

Loan instrument options?

  • Fixed vs. Adjustable rate
  • Long term vs. Short term
  • Points vs. No points