Is It Ever Wise To Get A Mortgage? Who Can You Trust?

John Parks
November 3, 2008 — 1,552 views  
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Even with our current economic times and the failure of several financial institutions, mortgages are here to stay. In fact, over 80% of all homeowners have mortgages. But, is this a wise decision or are these people asking for trouble? In this article, we will discuss whether it is wise to get a mortgagee as well as who you can trust in the mortgage industry. Lastly, we will provide you with some tips in dealing with the mortgage industry. Sound good? Let's get started.

First all, let's discuss the benefits of a mortgage. Well, there are many benefits of getting a mortgage. First, mortgages allows people to purchase property that they were not otherwise able to buy and actually provides them with a long term investment. In addition, having property provides most people with a sense of financial peace and also gives them immediate tax breaks from the government.

Be that as it may, there are many mortgage pitfalls that you must watch out for if you're considering a mortgage. They are as follows:

1. You must be in a position to afford a mortgage. Many homeowners make the mistake of getting mortgages that they can't afford. They simply rely upon unscrupulous lenders who prey on their ignorance. As such, many of these mortgagors tell them that they can afford a high priced home without taking into consideration other debts, and living expenses like utilities in calculating their bottom line. In addition, most of these lenders encourage them to use the income of both spouses to qualify for the mortgage. Then, if one of them lose their job, they find themselves in big trouble because they can't afford to make the mortgage payment any longer.

2. You must realize that you will have other bills to pay in addition to your mortgage. Therefore, before taking out a mortgage you must make sure that you can meet your mortgage every month and your other financial obligations as well as emergencies. Therefore, before you sign on the dotted line, write up a detailed budget that you will follow and make sure that your mortgage payment accounts for no more than 20% of your total budget. This way, your mortgage will be a good financial decision and not a liability.

Now, that we've discussed the benefits and the pitfalls, let's discuss whom you can trust in the mortgage industry. Basically you can trust yourself to make a good decision. Most financial institutions are in it for themselves. Therefore, you have to be wise and purchase a home that you can afford. Also, when dealing with a financial institution, choose a company that is FDIC insured and one that doesn't try to sell you a mortgage that you can't afford. A good choice is a reputable bank that offers a low fixed rate mortgage and encourages you to purchase a home within your financial means.

In conclusion, it may be wise to get a mortgage if you meet the above criteria. Simply make sure you can afford it, can handle your additional bills and deal with a reputable lending agent who understands your housing needs and doesn't try to put you in a bad decision. By doing this, you can reap the benefits of home ownership and get those tax breaks that you deserve.

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John Parks