Most people are afraid of mortgage shopping. And why not? Who wouldn’t be scared with all the math and confusing terms like adjustable rate mortgage, good faith estimate, and jumbo loan?
A recent survey showed that almost half of Americans don’t shop around for mortgage—and fears are the number one reason. Your mortgage fears may be valid, but it may be costing you more. Mortgage experts in Utah list down some common mortgage anxieties and ways you can overcome them.Fear of Rejection
Most homebuyers are afraid that their application will be denied. Rejection is frustrating and embarrassing. Often, people don’t want to try looking for other agencies because of the fear of another rejection.
Be proactive. Don’t nurture disappointment or shame. The first step is to review the rejection letter carefully. See why the lender turned the application down. Common reasons for rejection include the value of the home, creditworthiness, or debt load. Look for a solution to the problems plaguing you. Look at the different loans available or send in applications to other lending agencies.Fear of the Financial Realities
Some people don’t apply for mortgage because the entire process is too tedious. They simply want all the fun things about home buying, but try to avoid the financial realities involved.
Great things require preparation. Getting your finances ready is part of realizing the Great American Dream. Mortgage application may seem like an inconvenience, but remember that missing out on a property—which is the greatest asset you can direct your money towards—is a bigger inconvenience and source of regret.Fear of Refinancing
Many are hesitant about refinancing because they fear that it’s not a good financial move. Further, refinancing involves many complex factors. Homebuyers must consider upfront costs, likelihood of moving within a short period, current mortgage balance, possible interest rate changes, and other aspects. These matters can make the process difficult to understand.
Educate yourself on the various aspects of a mortgage application. Learn from mortgage experts. Consult them. All of this will make it easier.
Your mortgage fears may be precisely what is keeping you from realizing the great American Dream. Face those fears with smart financial planning. Financial literacy is the smartest course of action to overcome those mortgage anxieties.