You’ve decided that you’re finally ready for home ownership, but you need additional financing to make your dream a reality. Financing in the form of mortgages, while common, can be a confusing and stressful process. There are costs involved, there is debt, and there are some things everyone should be aware of and understand before taking on a mortgage.
Your Yeti Law Legal Sherpa® has the experience and the expertise to guide you through the application process, and to make your mortgage manageable. You can be assured that with the help of your Legal Sherpa®, you will have all the facts, know the potential risks, and will be best prepared to move forward with your mortgage.
Why Involve your Lawyer?
A qualified real estate lawyer, like your Legal Sherpa®, will walk you through the mortgage process from start to finish, answering questions and addressing concerns regarding what is being borrowed. It’s important to understand the specifics of what is being borrowed, as it is sometimes obscured by complexity. The complete terms of the mortgage are also important to read carefully. A mortgage may contain very specific terms and clauses, which can make the specifics difficult to understand if you are inexperienced in dealing with legal jargon.
You may have questions about the benefits of a fixed term vs. a variable interest rate. You may need to understand the terms of repayment, as they can be very specific, and it’s best to know what they state in detail. You may have questions about refinancing, about transferring your mortgage to another lender, about the status of your mortgage if you choose to sell, or even about penalties surrounding early repayment. You may be planning to rent your property, and are concerned that the mortgage’s terms may prevent rental to tenants for the duration of the mortgage term. Your Legal Sherpa® has answers to these, and any other questions that might arise.
Your lawyer should also outline any and all risks associated with the mortgage, and have the ability to inform you as to what is currently on the title to the home.
Areas of Potential Concern
One very important element of the mortgage process is ensuring the discharge of any mortgage held by the previous owners. Failure to do so will seriously and negatively impact your ability to sell the property in the future. Your Legal Sherpa® can confirm the status of the property, and determine if there are any entanglements with previously undischarged mortgages and work to discharge any if they are found.
Some lenders may require title insurance. Although the benefits of title insurance usually far outweigh the cost, in this instance, it’s likely that this will be a lender’s policy which, by nature, is set up to protect the lender
rather than you. Your lawyer can help you find financial protection in the event there is a title problem that may impact you financially.
Though uncommon, mortgage fraud is a pitfall that can lead to serious debt. In some cases, a third party has managed to transfer the title into their own name, allowing them to borrow heavily against the mortgage. It’s a frightening possibility, and another reason to involve a lawyer in the mortgage process as your lawyer will have tools at their disposal, such as performing a title search, to flag any potential mortgage fraud issues.
Best Practices and Forward Planning
By partnering with your real estate Legal Sherpa® lawyer, you can alleviate your stress even further by walking through mortgage best practices, and build a personalized strategy for saving and repayment in order to ensure that you are paid off as soon as possible.