You've found the home that is right for you, and now you need to do the same thing for a mortgage. There are several options for people out there, each one designed for a different type of buyer.
You need to ask yourself several questions when searching for a mortgage type.
1. How long am I planning on being in this home?
2. What monthly payment can I afford?
3. What type of payment fits into my long-term financial plan?
4. What type offers me the best rate for my situation?
Since most people like the security of knowing what their payments will be long term, many will get a 15 yr. Or a 30 yr. Fixed rate loan. But this may not be what would work best for you. Below are some things to consider when making your selection:
Fixed Rate Loan-
This works well for those with a steady income who like the stability of knowing what their monthly payments will be. If you have little or no down payment, a 30 yr. Fixed Rate loan is probably the best one for you. If you have a larger down payment and can afford a higher monthly payment you can opt for a Fixed Rate loan for 15 yrs., or even in lengths of 10, 20, or 25 years. Some lenders offer 40-year mortgages, which would allow some people to buy a larger house without the larger payment. The longer the loan terms, the more interest you end up paying. You always have an option to pay additional principal as the loan progresses. This would decrease the amount of interest you pay on the loan long term, and shorten the length of the loan.
Variable Rate Loan-
Most Variable Rate loans start out with a fixed rate for a specified length of time and change to a variable rate loan. These work well when people expect their income to increase dramatically after a few years, or those planning to move from the house after a few years. The most common loan lengths are 3/1, 5/1, 7/1, and 10/1. The first number is the length of time in years the loan is at a fixed rate. The second number is the length of time in years that it would adjust in after the fixed rate period. There is a cap on the amount of percentage points it can go up after the fixed rate period. It is usually 2% a year. With these types of loans you may pay more principal and less interest in the long run.
Biweekly Fixed Rate Loan-
This loan type works similar to the fixed rate loan, but essentially is a guarantee that you will put extra money toward your principal. You pay half your payment every two weeks instead of monthly. You end up making 13 payments a year instead of twelve, thereby reducing your principal early and reducing the length of your loan.
With some careful consideration on your part you will be picking the perfect loan for you in no time at all.
Genesis Font is an SEO and Developer for Mortgage and Loan Officer Websites. We also offer Quality Web Hosting Services.
Recent news has made much of parents stretching their finances... Read More
A mortgage is a loan that is guaranteed by a... Read More
Availability of Home loans is in full bloom. They are... Read More
Think About the Long Term. Estimate how long you expect... Read More
A quickly growing trend in lending is the online homeowner... Read More
Here in Spain the concept of a mortgage period of... Read More
If you have low income and are looking to get... Read More
If you fall behind in your mortgage payments, you face... Read More
I fully realize if it sounds too good to be... Read More
When you need a mortgage -- either because you are... Read More
If you think you have good credit, think again. Chances... Read More
If you have bad credit history, no down payment or... Read More
Refinance NOW-before it's too lateIf you haven't found the time... Read More
A brief list of some of the most common Mortgage... Read More
Refinancing your home is a major decision not to be... Read More
Most borrowers fail to realize that when trading their much... Read More
As the term implies, with a fixed rate mortgage the... Read More
"You can save time and money by applying for a... Read More
Homeowner - does this term catch your attention every time... Read More
Mortgage cycling is a system that relies on solid budgeting,... Read More
To find the cheapest home improvement loan that you can,... Read More
Commercial mortgages are similar to residential mortgages. Usually taken by... Read More
A few years ago, a loan officer who worked for... Read More
The housing market has been buoyant over the past few... Read More
Mortgage underwriters can be a suspicious bunch. If you have... Read More
For years, when someone wanted to purchase or refinance a... Read More
The information in your credit history helps mortgage lenders decide... Read More
Refinancing your home mortgage can come with some great perks.... Read More
A pension mortgage may seem lucrative at the first sight.... Read More
If you have a recent bankruptcy on your credit and... Read More
Tapping your home's equity to pay college expenses, consolidate credit... Read More
One of the most common terms found in a new... Read More
You're considering refinancing your home mortgage loan to save money.... Read More
I have written many articles on refinancing a fixed rate... Read More
A mortgage is a loan, usually from a bank, finance... Read More
Refinancing your mortgage after bankruptcy is actually the same as... Read More
If you in the process of looking for your first... Read More
Procuration fees paid by some sub-prime lenders are too high.Fact.There... Read More
There are many reasons to use the internet to take... Read More
Fixed Rate Mortgages: These loans have a fixed rate of... Read More
As the term implies, with a fixed rate mortgage the... Read More
If you fall behind in your mortgage payments, you face... Read More
"How much should you borrow?" is a question people with... Read More
A secured home loan differs from an unsecured loan in... Read More
So, your bank had just turned you down for a... Read More
Being self employed has many benefits. When you are self-employed,... Read More
Mortgage rates typically are based off the current rates of... Read More
In recent years, the mortgage industry has introduced dozens of... Read More
If you buy new windows, you'll not only pay for... Read More
A new survey reveals that in the last five years,... Read More
Mortgage elimination programs are all the rage these days. In... Read More
An offset mortgage is very similar to a current account... Read More
Rising home prices, particularly on the East and West coasts... Read More
One of the biggest reasons homeowners refinance their mortgage is... Read More
An adjustable rate loan, most simply stated, means that your... Read More
Have you heard about or been interested in finding out... Read More
Choosing a home loan has never been tougher. Yes, with... Read More
As loan officers, the word "lead" is by far one... Read More
Sub-prime mortgages are not that much different from average mortgages.... Read More
Home equity loans and lines of credit are useful tools... Read More
Once you have made the decision to buy a home... Read More
While most multi family properties are designed to allow the... Read More
If your mortgage company is threatening foreclosure, there are things... Read More
Have your home's appreciation grow twice as fast.For Seniors over... Read More
About 29% of current homeowners and a much larger percent... Read More
Since the demise of the stock market in 2000, the... Read More
Mortgage Refinance |