4 Major Mortgage Do’s that Can Apply to Any Business Decision

What does getting a mortgage have to do with running a business or making a smart career move? Ask a mortgage lender with knowledge of both the financial and housing industries, and they’ll tell you that the parallels run deep.

Mortgage decisions

These mortgage guidelines translate perfectly into the business world

If you’re interested in refinancing or buying a home, soon enough, you’re going to meet with a mortgage lender. And quite often, when you meet with an experienced lender, they’re going to help you along by making you aware of a few non-negotiable principles. These insider mortgage tips can make finding the right home loan much easier.

Whether in business or when buying a house, several rules may apply:

1. Choose a partner with a great reputation

When you’re making a financial investment and working with someone you trust, you’re going to feel a lot more comfortable with the paperwork you sign. You may even sleep better at night. “The first thing when making a business decision is to speak to a trusted advisor. Whether it be a tax planner, CPA, business coach, or banker – business decisions based on sound advice tend to have better results,” Andrina Valdes, Executive Sales Leader and CMO of Cornerstone Home Lending, Inc., says.

As a first step, always select your business partner – and your lender as a partner in your mortgage – based on both experience and reputation.

2. Get acquainted with your credit

There’s nothing more unpleasant than finding out your credit score in the process of applying for a loan. In business, and in mortgage, it’s important to remain one step ahead. Request that free credit report you’re entitled to by law each year and get to know the number. Having a firm grasp on your credit score can put you in the driver’s seat.

When buying a house, your credit score can affect your mortgage rate. It can also affect your monthly mortgage payment. Your credit score, as a reflection of your personal financial health, may not impact your career directly, but it could determine your eligibility when taking out a small business loan.

Businesswoman analyzing financial reports

3. Know what you can afford

Before you even start looking for a house, it helps to meet with a lender. Not only does getting prequalified for a home loan first make it easier to nab your ideal house when it comes available, but a home loan prequalification is going to give you the big-picture scope of how much house you can afford. Crossing this hurdle early can also help to expedite the process when you start house-hunting.

“Getting your ducks in a row” plays off Mark Cuban’s best advice for young entrepreneurs and startups. The billionaire business mogul and Shark Tank star has encouraged entrepreneurs to rely on investors as little as possible. While seemingly counterintuitive, this again means knowing what you can afford before going into a major financial decision. Create a business plan, factor in the funds you have available, and consider sweat equity and small investments to cover the rest.

4. Take advice from the right people

When buying a house, when starting a new business, and when changing career paths, it’s never a good idea to take advice from a neighbor or a well-meaning friend. Buying a home may be one of the biggest investments of your life. You’re at an advantage when you get your mortgage information and rate quote right from the source — your lender. A 2015 Fannie Mae housing survey confirmed that homebuyers who are better informed are more likely to get better terms on their mortgage.

Aligning with a career mentor who has gone before you is one way to get a leg-up and gain perspective. Female employees may receive even more benefits from mentors in the workplace, as University of California Berkeley researchers discovered in 2015. When women working at a software development lab for an American company in China paired with skilled mentors, they gained more social capital — with the potential to expand professional networks — than their male coworkers.

If there’s one common theme among these mortgage rules, it’s in getting help from the right people before making a life-altering decision. For homebuyers, this is your lender. And for entrepreneurs and professionals, this could be your mentor or business partner. “By involving the advice of others, you keep the decision centered around a core element,” Valdes says. “That element can be what is best for the company, what is best for employees, what is best for customers, or it can be a balance of short-term versus long-term gains.”

For educational purposes only. Please contact your qualified professional for specific guidance.

Sources are deemed reliable but not guaranteed.