Dispelling Mortgage Myths That May Mislead You

Hello, my name is Landon Hansen and if you need advice about finances or your money situation, I do hope that you'll read my blog. During a period in my life, I was reckless with my spending. This led to a mound of credit card debt that I was diligently trying to pay off. After awhile, it seemed like I was getting nowhere fast so I started researching ways that I could pay off my bills and get out of debt as soon as possible. I'm happy to say that the methods I tried worked and I was able to drastically reduce my debt to a manageable level. If you need help with your debts, please read my blog to learn tips that will help you and your money situation tremendously.

Dispelling Mortgage Myths That May Mislead You

27 February 2015
 Categories: Finance & Money, Blog


It is a sad fact of life that most people will never have enough cash available to outright purchase a home. While mortgage loans are available to those that are in this position, these loans can be highly complex legal contracts, and if you do not fully understand the terms, you may find yourself facing problems down the road. Unfortunately, there are many people that are under the impression that a couple of myths about mortgages are true, and this can result in them encountering problems with their loan. 

Myth: Pre-Qualification Is Good Enough To Start The Buying Process

Before you start shopping for a new home, the first step is to determine the amount of financing that you will have available. Generally, there are two terms used to describe this process, and some people get them confused. Pre-qualification is an estimate of the maximum amount of money that the borrower could potentially receive. Pre-approval is when an individual has been approved for a specific mortgage amount. 

As a result, you should generally avoid shopping for a house until you have received some form of pre-approval. In fact, most real estate agents will want to know you have been pre-approved for a mortgage before they invest a substantial amount of time in helping you find a home. 

Myth: There Is Nothing You Can Do To Lower The Interest Rate Of Your Mortgage

Sadly, there are many people that have had financial problems in the past that may result in a less than perfect credit history. When this is the case, you can expect to pay a higher initial interest rate, and for some people, this may push the dream of homeownership out of reach.

Luckily, there are often some steps that you can take to reduce the amount of interest you will be paying. Many mortgage lenders provide individuals with the option to do a rate reduction. This allows the borrower to pay a one-time fee to lower the interest rate on the loan by a specified amount. Also, there are many loan programs that will reward homeowners with reduced interest rates in exchange for always paying the bill on time. Talk to your mortgage lender to determine which programs are available to you for lowering the interest rate on your loan. 

A mortgage may be the only way that you can come up with the money needed to buy your dream home, but many people are ill informed about this financial resource. By understanding that these two prevalent myths are incorrect, you will be better informed when you are making a choice for your needs. 

About Me
Finance and Money Tips To Manage Debt

Hello, my name is Landon Hansen and if you need advice about finances or your money situation, I do hope that you'll read my blog. During a period in my life, I was reckless with my spending. This led to a mound of credit card debt that I was diligently trying to pay off. After awhile, it seemed like I was getting nowhere fast so I started researching ways that I could pay off my bills and get out of debt as soon as possible. I'm happy to say that the methods I tried worked and I was able to drastically reduce my debt to a manageable level. If you need help with your debts, please read my blog to learn tips that will help you and your money situation tremendously.

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