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4. Understanding Mortgages

As a potential new homeowner, we’re here to bring you back to the days of chalkboards and textbooks to remind you of the importance of doing your homework to help make the most of your real estate investment. By following these tips, you will have a deeper understanding of the different types of mortgages so you can make an informed decision when it comes time to choose the right one for you.

Do Your Credit Report Homework

Before you start applying for your mortgage, be proactive and get a copy of your credit report. Once you have it, thoroughly check for errors and other items which may need to be addressed. Since your ability to get a desired mortgage rate largely depends on the information contained in your credit report, it’s important for you to ensure that all the information is correct.

Get Organized

Prepare the necessary documents in advance. This will save you time and ensure a smooth application process. Depending on the type of mortgage you’re applying for and your employment situation, various documents may be necessary. Use this TD checklist to identify some of the paperwork you may need to begin collecting.

Get the Stamp of Pre-approval

Getting pre-approved for a mortgage helps you understand how much you can borrow before going through the mortgage application process. This is an important step as it will influence your decision on the upper price limit of your house purchase, and will provide some realistic boundaries before diving head first into the process.

Consider the Future

Your mortgage should be planned in accordance with your future. Your plans may change, but the end goal should always be to reduce financial risks. Think about how long you’re planning on staying in the house, whether or not you should consider saving for a larger down payment, and how much of a risk you are willing to take.

Inform Yourself

It’s important to be well informed prior to applying for a mortgage. Understanding the options and procedures involved with buying real estate will be hugely beneficial to your plans and finances. See below for a better understanding of the different mortgage types.

Being well informed and educated on the mortgage application process is important when it comes time for you to apply. Understanding your options will be greatly beneficial seeing as this is one of the most important steps in your home buying journey. We’ve created a downloadable resource to help guide you through the application process and get you set on your journey to home ownership.

If you have questions about applying for your mortgage, or the different options available to you, make sure you reach out to your RE/MAX agent who will be able to help.