Getting ready to buy a home or refinance your mortgage? Here’s some advice to avoid common pitfalls during the process.

Cover your basics.

Know what your home is worth, don’t underestimate the worth of real estate marketplace websites (, Zillow, Redfin, etc.). They can be great tools to determine the realistic monetary value of your home before you speak to your lender. They can give you a general idea of your home value, if not the exact number.

Know your credit score.

Your rate and your credit score typically coincide, and forewarned is forearmed. There are plenty of sources online that readily provide this information for free. Paying your bills and keeping your credit line to below 30% of your limit can go far in rebuilding your credit. If you have bad credit or outstanding debts in collection, it could take months (or years) to repair so keeping that in mind when planning a home purchase is key to not overpaying and acquiring a high interest rate for a home.

You will have your credit scores run when applying for a refinance and then again just before closing. So, keep that in mind when you’re applying for new credit cards and acquiring new debts during your process. Simply opening a new credit account can lower your credit score. Unfortunately, the lower your credit score, the more you will end up paying on refinancing or mortgaging of your home.

Think about loan terms.

Something to keep in mind is your loan term. 15, 20 and 30 year loans are the standard. The longer your loan term, the more you will pay in interest but you will have more money each month to cover your other expenses. Short term loans have higher monthly payments but will be paid off faster with a minimal amount of interest paid.

Calculate your fees & save up.

A common oversight when refinancing and buying are the fees. Regardless of how much money you’ll be saving long term, appraisal fees, title fees, loan application fee and attorney’s fees are all due at closing. There is however, a no closing cost option but that will renege the effort of keeping long term costs down.

Timing is everything.

While on your search for rates, leaving lenders on the hook for weeks on end in hopes of getting a lower rate elsewhere could come back to haunt you; leaving you with limited options. So striking a balance between pinning down a bid within days of an offer while still shopping around for alternative lenders is highly advisable. Making the most sensible decision is not out of reach! Keep in mind that you do always have the option to refinance again if rates dramatically drop.

Contact EC Mortgage Lenders to get your best rate today!