7 Mortgage Myths That Quietly Cost BC Buyers Money
A lot of what people believe about mortgages is out of date or simply untrue, and those myths can cost real money or delay a purchase for years. Here are seven of the most common ones I hear, and the plain truth behind each.
Myth 1: You Need 20 Percent Down to Buy a Home
This one keeps more people renting than any other. In reality, you can buy with as little as 5 percent down on the first 500,000 dollars of the price. With less than 20 percent down, your mortgage is simply insured, which is completely normal and gives you access to the best rates. Many buyers are ready years before they realize it.
Myth 2: Your Bank Gives You the Best Deal
Your bank can only offer its own products. As a broker, I compare many lenders, from major banks to credit unions and other lenders, to find the best fit for you. Loyalty to one institution often costs more than it saves.
Myth 3: The Lowest Rate Is Always the Best Mortgage
A low rate attached to the wrong terms can cost you far more over time. Restrictive penalties, limited prepayment privileges, and poor flexibility can quietly outweigh a small rate difference. The best mortgage is the one that fits your whole situation, not just the number on the sign.
Myth 4: Using a Mortgage Broker Costs You Money
For most residential mortgages, my services are free to you. The lender pays me when your mortgage funds, so you get access to many lenders and my guidance at no direct cost, rather than being limited to a single bank.
Myth 5: A Pre-Qualification Is the Same as a Pre-Approval
They are very different. A pre-qualification is a quick estimate with nothing verified. A pre-approval involves reviewing your documents and credit and comes with a rate hold. When you make an offer, only one of them carries real weight.
Myth 6: If You Are Self-Employed, You Cannot Get a Mortgage
Not true at all. Self-employed simply means your income needs to be presented the right way, and there are lenders and programs built specifically for business-for-self borrowers. Your smart tax planning does not have to work against you.
Myth 7: You Should Always Renew With Your Current Lender
Signing the renewal your lender mails you is rarely their best offer. Your renewal is a chance to compare the whole market and often improve your rate or terms. It takes a quick conversation to find out whether you can do better.
The Truth Is Usually Good News
Most mortgage myths make homeownership feel harder or further away than it really is. When you have the facts, the picture is often far more encouraging. I got into this work because I believe knowledge is power, and the more you understand, the fewer of these myths cost you money.
Heard something about mortgages that worried you? Ask Rabinder Dhillon and let's separate fact from fiction, with no pressure.
