Introduction: Interview with a mortgage broker
Please allow us to introduce our good friend Mia, a retired mortgage broker. Do not let that fool you, she is not near retirement age yet! We thought, “She has lots of great information. We need to share this with our readers as soon as possible!” So we had to schedule her for an interview. After all, mortgage brokers are typically great at handling their own finances. Also, they have an insider view of the mortgage process that most people will never see. Not to mention since we know her personally we know she is one of the most intelligent people you would ever hope to meet. To conclude, we know this is a helpful and informative read so pull up a seat and listen very closely!
What would you tell someone seeking a mortgage who only has ok or bad credit?
“Good way to lose a home fast. Do not do it. Fix and peak your credit score first!”
What are some tips to prepare for the mortgage process?
“You have to have your credit fully in line. You are not going to qualify for the mortgage unless your credit history is at least good. Even minor medical bills in collections, overlooked prior, can now disqualify you from a mortgage. Do not ever sign any balloon mortgages! Also, get a fixed rate, never take a variable mortgage as well of course.”
What are some good resources for low-income mortgages?
“There are even loan programs that are especially for women. HUD has many good options. Fannie Mae and Freddie Mac was decent a little while back, but I’m not entirely sure about now.”
Do you have any tips for our readers about mortgages?
“Well, mortgages are a very monitored process. They have been since the mortgage collapse. You want to be sure your credit is at its peak before even considering a mortgage. Most importantly, be sure to purchase a home well within your means. Frequently, mortgage brokers will over sell a mortgage. They will offer you more home than you will be able to re-pay. The privately owned banks want you in more debt than you can afford. Buy a house for under 1/4 what you qualify for. So, if approved for a $200,000 house then you need to stay under $50,000. You will succeed if you can be modest. We have three payments left on our mortgage other than that we are completely out of debt.”
What about cars? Any recommendations there? What should we do with vehicles?
“We own our cars outright, no payments there. We do not own brand new vehicles. Even though we can afford them. Remember that cars are disposable. Cars today are made very cheaply. Frequently, they barely survive the warranty. Honestly, most of them are probably designed to lemon out. Just after the warranty usually, something big will break.”
Interesting information most people will never tell us.
So, no brand new car. Got it!
What is the maximum we should spend on a vehicle? If we can afford it, what is the newest car we should get?
“Don’t take on a new car payment, any intelligent person will tell you the same. Cars on credit are not generally a good idea. You can buy a very good used car for around $5,000 or less. Also, you should not spend more unless you can pay-in-full upfront. Most car models don’t vary much within a five-year range. Just cosmetic changes mainly. So stay at least 5 years behind current.”
Thank you very much for this informative and very helpful interview, we are very grateful. Do you have any final words of wisdom and advice for our readers?
“Yes. Budget. You want to save as much money as possible. You want 2-5 years of your bills available and accessible in cash. Also, you want the same in the bank. This will give you a 4-10 year cushion. If the worst happens and you lose income, the bills will still be paid. Emergencies come up all the time. Save! Do not be unprepared. Many people have lost homes and cars simply by not having savings to get through hard times. You will be fine if you take it as a high priority. I just can not stress to save loudly enough. What is worth more to you: That coffee you get out every morning? Or your house and car? Too many people do not see it that way. However, the people who do save usually do not lose their houses and cars.”