How To Manage A Mortgage

Managing A Mortgage To Your Advantage

If you are looking for a worthwhile mortgage in today’s market, it is advisable to be ready for some difficult years ahead, as the real estate market searches for stability in the wake of two years of severe turmoil. Mortgage management is more important now than it has ever been before, as there is a tendency among banks to become very nervous and panicky when customers exhibit any sign of the feckless borrowing habits that played such a large part in triggering the current global financial crisis. It is not necessarily more likely that you will be the victim of a repossession – banks are still reluctant to do this where there is any other option – but it will affect what kind of deal you can get, if you happen to be caught up in a situation where you are unable to pay.

Mortgage management begins right at the start of the mortgage period, when you first apply for the loan. The first part of a good process of mortgage management is to tell the truth on your application. There are some situations where it is possible to successfully apply for a mortgage by lying on your application and qualifying for preferential rates. Depending on the level of due diligence carried out by the lending bank, you may get away with it. If you do, however, it is important to remember that mortgage loans are frequently renegotiated, and that any information you give on your application can be checked at the source. If you lied on your initial application it is an option for the bank to sue you.

Another reason why it is simply common sense to tell the truth on your application is that although the lie may give you a preferential rate, you may still find it difficult to make the monthly payments on a big loan. If you struggle with these payments, you may be asked to provide evidence for why this has happened, and if you expose the lie at that point you are again liable to be sued.

By far and away the main aspects of sound mortgage management come, though, when you have been awarded the mortgage and are paying monthly to the account. Budgeting plays a huge part in mortgage management, and making sure that the first deduction you make from any month’s pay check is your mortgage payment should mean that you can prioritize your financial commitments – of which keeping a roof over your head must be considered the most important.

If you ever fall into financial difficulties that make the monthly payments to your mortgage difficult to maintain, it is essential that you discuss the matter with your mortgage lender. Early reporting of any problems makes for a much better chance of solving them than late reporting.

Finally, and quite literally so, if you find yourself in with a chance of paying off your mortgage in full you should take into account what the most economic way of doing this will be. Some lenders charge a surcharge for early payment, although this can be on a sliding scale and may also be negotiable. Check your terms and conditions, and discuss matters with your lender.