The spring home buying season is here and it’s undoubtedly a buyer’s market in most areas, yet many prospective home buyers appear ill-prepared to take out a mortgage. In fact, nearly half of prospective buyers don’t understand mortgage basics, leaving them vulnerable to costly mistakes.
Zillow Mortgage Marketplace, along with independent research firm Ipsos, surveyed prospective buyers, asking them to gauge their own knowledge about mortgages, and asking them basic questions about mortgage facts. The result: Nearly half of surveyed buyers don’t understand essential information about mortgages, including details about loan types, mortgage rates, fees and loan qualification requirements. For example, one-third of those surveyed do not understand that lender fees are negotiable and that they vary by lender. This likely means many buyers aren’t shopping around and getting the best terms possible, which can cost them money.
In addition, nearly half (44 percent) of prospective buyers said they are not confident in their own knowledge about mortgages and the mortgage process.
Are you one of those buyers lacking confidence in mortgages and the mortgage process? Every prospective buyer should know the answers to the these eight simple questions before they venture out into the market.
Test your knowledge!