3 Things You Understand After Your First Home Loan

We know you have heard it many times, but taking out a mortgage is one of the biggest financial commitments you can make. You can prepare yourself endlessly, but there are just some things you just won’t get until you have purchased and settled your first property. Check out some of the things our team has learnt from working in the real estate agency and purchasing property with a mortgage.

How important a low-interest rate really is

You have read it a thousand times, every bank is telling you that their rate is the lowest, you have shopped around, haggled for a rate, researched, devised pro and con lists. A low-interest rate can trim years off the repayment term of your mortgage and save you a ton of money in the long term.

A 20% deposit is a must

The Lender’s Mortgage Insurance is applied when you take out a loan for more than 80% of the property’s value (not the purchase price) you intend to purchase. This insurance protects the bank if you were to stop paying your loan, and it can be a considerable hit to take when you consider the total amount of debt you are undertaking.

Take your business elsewhere!

Many first time borrowers think they are locked into a mortgage with a particular lender. This is a misconception, you are entitled to shop around and look for the most competitive rate and the lowest fees, and refinance your loan as many times as you like. Speak to your lender about your options for securing a better rate, or swapping loan type for a no-fee option. Be armed with competitor rates and pricing, and stay firm. If they don’t value your business, take it elsewhere. A little bit of paperwork and time spent refinancing your home loan could save you so much money over the life of the loan. If you have questions about purchasing property with a home loan, do not hesitate to reach out the team at Eview Mornington Peninsula.

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