Don’t Fall For These Four Common Mortgage Myths
Whether it’s your first home or one of many, buying a home is a significant investment that requires a mortgage. As exciting as this milestone in your life is, you may be vulnerable to mortgage myths and misinformation. These falsehoods can make the home buying process more challenging, so it’s imperative to be aware of them.
The Collin Bruce Mortgage team is here for you, which is why we’ve debunked the most common mortgage myths below:
Myth #1: Pre-Qualified and Pre-Approved Are the Same
Getting pre-qualified may be akin to getting pre-approved for a mortgage, but the two processes are not identical. It’s crucial to be aware of the differences between the two going forward in your home buying transition. A pre-qualification is essentially an estimate of how much you will be approved for based on your credit and finances. However, there are no guarantees that you will be approved for that specific amount. A pre-approval means you’ve provided physical proof and received a lender stating the loan amount has been approved by your lender. With a pre-approval, there is no estimate, and you are being informed of exactly how much you can afford.
Myth #2: You Must Put at Least 20% Down
If you’re a first time home buyer in Edmonton, avoid falling for the myth that you must put down at least 20% to even qualify for the mortgage you desire. There are several mortgages that only require a minimum of 5% down payment which allow home buyers more time to save and prepare for the payments. At Collin Bruce Mortgage, we can help you set up your credit line and borrow the down payment to qualify for more mortgage options. For a no down payment mortgage, contact our team to learn more!
Myth #3: Must Have A Credit Score of 800 or Above
The myth that it is imperative to have an excellent credit score to even qualify for a mortgage is false. A higher credit score will help in the home buying process, but having a lower score does not eliminate you from all options. Collin Bruce Mortgage can help you access a copy of your credit report to start restoring your damaged credit line and increase it. Your credit report has information on your liens, judgments, and more.
Myth #4: Banks Give You The Best Rate
Banks are more likely to attempt to sell you higher mortgage rates and products instead of finding the most suitable mortgage for your financial situation. As much as you may want to trust your bank without question, these institutions have a tendency to use your customer loyalty against you. Hiring a mortgage specialist is the most viable choice to find the best possible mortgage rates for you.