We all know financial stuff is complicated. Heck, it seems like it’s designed that way to keep us consumers from getting a good deal.
But knowing the industry jargon could mean the difference between a great deal and a terrible one.
A survey released back in April by Zillow revealed that consumers spent the same amount of time researching a mortgage as they did a vacation.
A paltry five hours.
Meanwhile, an average of two hours were spent researching television options and 10 hours were spent shopping for a car.
Pretty shocking isn’t it? That’s why it’s imperative that you actually put some time into your financial decisions and ask pertinent questions if you’re unsure of something.
Those same consumers probably don’t know key definitions related to their quest for a loan, like how credit score and loan-to-value ratio can greatly affect your mortgage rate, or even what a mortgage point is.
If you don’t know the meaning of the fees, or that they even exist, there’s a good chance you’ll be overcharged and/or preyed upon by unscrupulous lenders.
Same goes for the type of mortgage product you land in – with little research, the person selling you the loan will likely have the final word as to what you end up with.
Most of these same consumers probably didn’t bother to look up a simple mortgage dictionary either, despite the fact that doing so could have saved them thousands, or kept them from making a financial misstep.
The average cost of a mortgage is $145,920, while a week-long vacation has an average cost of $1,708.
So each hour spent researching the mortgage is valued at a staggering $29,184. Seems a little costly, right?
(photo: thetruthabout, flickr)