At the beginning of 2015, there is a new trend that seems to dominate the financial market - steady decrease in mortgage interest rates, which helps this sector quickly regain strength after the bad past few years. With real estate prices raising slower than ever, people are becoming interested in investing in property once more and also refinancing their existing loans. To help make the decision much easier, here are my top 10 tips for securing the best mortgage:
Cut Down Mortgage Insurance Payments
For many borrowers, the mortgage insurance payments make up for large portion of all expenses related with the actual loan. Its purpose is to protect both the lender and the borrower in case the loan is defaulted. Improving your credit score can definitely make a difference in terms of cutting down insurance payments.
Preapproved mortgage can help prevent a lot of headaches and will definitely make your property offer much more appealing. Furthermore, this is the best way to get more accurate terms from the lender and rely solely on your rough estimates.
Maintain Clean Credit Profile
All lenders use your credit profile to determine specific terms for your mortgage, so its crucial to stay away from trouble at least few months before submitting your application. The reason for that - any damage to your credit profile will not only make the rates and payments higher, but could even prevent you from being qualified to receive a loan.
Organize All Documents
Learn to keep everything related with your property investment organized and in easy-to-access location. You will not only need dozens of bank statements and property documents to apply for the loan, but you will also need to ensure your investment is bringing your desired profit at all times. Since we live in Digital Era, you should also consider storing the information on your computer and even better to use software to keep track of your expenses.
Avoid Moving Money Around
Since most banks monitor your finances for few months after providing you with the loan, it's important to avoid moving money around or you may end up owing explanations on how you got them in the first place.
With the help of the internet, this otherwise pretty daunting task can be completed within just few minutes. Websites like the LendingExpert.co.uk work with the best lenders on the market, so you can truly expect professional service every step along the way.
Self-employed Professionals Must Plan Better
There are many things that are great about being self-employed, but when it comes to applying for a mortgage this may be quite big disadvantage. With no guarantee on your income whatsoever, the risks involved with your mortgage applications are considered to be much higher than with others. The best way to go around this is to put as large percentage of the property price as possible and also carefully plan your future.
Consider when it's best to Refinance
What many people miss is to do the math to determine when it will be the best time to refinance their mortgage. This is golden opportunity to cut down your debt and planning ahead can save you from lots of headaches in the future.
Reverse Mortgage - Is it worth it?
For seniors over 62 years of age, the reverse mortgage is definitely the best instrument to finance the purchase of new home, without this having any influence on their retirement funds. With no monthly payments and 48% of upfront payment required, it's definitely worth tapping into this opportunity. However, if you plan to rent your property, you should consider fixed rate mortgage instead.