With mortgage rates hitting a 4-year peak, some mid-earners wonder whether they will get locked out of buying in the frenzied Colorado real estate market. According to a recent article by realtor.com, there are a few critical moves home buyers can make to ensure they land a good mortgage. Home buyers surveyed often find the mortgage experience "stressful," according to realtor.com. One of the most common mistakes home buyers in Colorado make is waiting until they cobble together a 20 percent down payment before competing in the current buying frenzy. Waiting is a smart idea when interest rates are low. But with rising rates and higher home prices in Castle Rock, Westminster and other hot areas, every month means higher costs. While it's true, a 20 percent down payment cuts out the PMI or private mortgage insurance, it's foolish to wait for the magic 20 percent. By working with a great real estate team, you figure out your home affordability factor as of today.

Meet with several lenders

Instead of picking the first mortgage lender you hear about, shop around. The Consumer Financial Protection Bureau points out that about 50 percent of home buyers only meet with a single lender before choosing a home loan. Different lenders offer a variety of interest rates, loan programs and fees.  Locking in on a higher fixed rate could translate into thousands of dollars over the course of a 30-year loan.

Get pre-approved, not pre-qualified

Another pitfall when securing a mortgage is to secure a pre-qualification letter rather than a pre-approval letter. In the seller's market in Colorado, buyers have to come prepared to the negotiation table. A pre-approval letter means the lender has verified your income and your ability to repay the loan. They have pulled your credit, assessed your debt and assets. Most pre-qualifications are purely based on information you give the lender to estimate your home-buying power.

Other important financial mistakes to avoid before house hunting include opening new lines of credit, buying a car or making other major financial moves and life changes such as divorcing or changing jobs. At Team Lassen, we help our clients get a handle on the current real estate market in Colorado so they can make the best decision for their families. For more information about the current buying frenzy, please contact us.