These Common Home Loan Mistakes Can Cost You Thousands
It might be easier than you realise to get stuck with a home loan that isn’t right for your needs. Home loans can be complex, and if you wind up with the wrong deal, you could potentially end up paying thousands more than you needed to.
Some investors wind up with the wrong kind of home loan, missing out on the perks and features they would have required to make a good return. Others simply get the numbers wrong, paying more than anticipated (and more than necessary) throughout the life of their loan.
Here are some of the more common mistakes people make with their home loans, and how to avoid them:
Focusing too much on short-term gain
It can be tempting to take on a home loan that offers immediate and clear benefit in the short-term, such as a loan with a low “honeymoon rate”. But mortgages and property are complex, and all the moving parts must be considered before you can determine whether or not you’re truly saving money.
When you take on a home loan, ask your lender about the effects of every benefit and/or feature in the long-term as well as the short term. Ask about the process involved in making adjustments down the line, and ensure the loans offered are flexible.
Not knowing enough about their lender
Some lenders provide internet banking, and others don’t. Some lenders charge large fees, and others don’t. It’s important to know whether or not your lender provides the basics – nothing should be assumed.
It can be tempting to go with a lender based solely on interest rates, or solely on any one feature. But make sure you consider the complete picture before making your decision.
Making decisions alone
Unless you’re a qualified expert yourself, you should never choose a home loan without consulting experts who can tell you what your loan will look like throughout its entire duration. And when you start playing with fixed rate terms and other complications, you really need to make sure you fully comprehend the ins and outs of your loan before finalising.
At Mortgage House, we’re no strangers to the homeowner’s journey. It’s a long (but rewarding) one.
But don’t worry, we can help with that.
If you’re thinking of buying a home, you can contact us for advice about the best options for you when it comes to your mortgage. The cost of your mortgage can drastically affect your financial planning, so it pays to speak to the experts about it.