The Most Common Mistakes When Taking out a Mortgage

Buying a home and signing a mortgage is one of the most important decisions people make.

Buying a home is one of the most important financial decisions most people will make in their life. And this usually involves getting a mortgage to finance the purchase of the home. However, mistakes are often made when taking out a mortgage due to a lack of knowledge or lack of planning. Here at ASUFIN we will let you know what are the most common mistakes when taking out a mortgage and how to avoid them.

Not comparing offers: One of the most common mistakes when taking out a mortgage is not to compare offers from different financial institutions. Many people simply go to their bank and accept the first offer presented to them, losing the opportunity for more favorable conditions.

Choosing an incorrect amortization period when signing the mortgage: Some people decide to take out a short term mortgage to pay less interest and pay off their home early, while others decide to extend the mortgage term to pay a smaller monthly payment. You must analyze your own financial situation and see what you can assume, what you can’t… in order not to make a mistake when choosing the mortgage loan period.

Not reading or understanding the contract: One of the most dangerous mistakes is not carefully reading the mortgage contract before signing it. The contract contains the loan’s terms and conditions, including the interest rate, term, and other important details. Not fully understanding what you are signing can lead to unpleasant surprises later on. To avoid this mistake, you must read the contract carefully and, if necessary, get help from an advisor. At ASUFIN we can help you resolve your doubts and claim if your mortgage has abusive clauses or you were forced to pay your mortgage’s expenses.

Not calculating the total cost: When signing a mortgage, it is important to understand the total cost of the loan. This includes monthly payments, interest accrued over the term of the loan, and any additional costs, such as insurance or expenses. Not having a clear idea of the total loan amount can result in long-term financial problems. Use our mortgage calculators to find out the total amount you’ll pay.

Not considering the future: Some buyers choose mortgages with variable interest rates or short terms without considering how this will affect their finances in the future. It is important to think long term and evaluate how changes in interest rates or your financial situation may affect your ability to pay your mortgage installment.
In short, don’t make the decision to sign a mortgage quickly and impulsively. Read the contract carefully and compare offers. Here at ASUFIN we work to provide the education and information you need to make the right decision when taking out a mortgage.


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