Before you even start looking for your first home, you should understand what you are looking for in a mortgage. There are several factors that could impact your residential mortgage rates and availability. But let’s look at mortgages as a whole to understand what it is you are looking for in the best mortgage.
How to Get a Mortgage
The first thing you have to know about getting a mortgage is how much you can afford to pay per month. This amount will help you find a home within a certain price range where you feel comfortable. Next you’ll have to apply for the loan. For this, you’ll have to talk to a loan officer where you’ll be asked information like residential history; employment and income; asset balance of all savings, checking, and retirement accounts; and debt payments and balances including student and car loans as well as child support. Your loan officer will look into your credit reports to confirm the debts and scores. If everything goes well, you will need a down payment and can select a loan type. The two main types of mortgages are fixed rate and adjustable rate. Fixed rate mortgages are secured in their payments with the ability to refinance to drop the interest rates. But if the national rates go down, you will be paying the same amount unless you refinance the loan. Adjustable rate mortgages have a lower initial rate but the rates could increase after the adjustment period. There are different types of mortgages available for different types of buyers including Balloon mortgages, VA home loans, and Federal Housing Administration Loans (FHA).
Factors That Determine Your Mortgage Rate
You can have a perfect financial record for the past five years, but that credit card you had in college could keep you from getting your new home. One of the first things a lender will look at is your credit score. These scores determine if you are a reliable person or if you are fiscally irresponsible. People with higher credit rates tend to get lower interest on their home mortgages. Another factor is location. As you are shopping around for mortgages, check with both larger and smaller lenders in order to get the cheapest price. Some large vendors might not service your area so be sure to check with local lenders to get a good rate. A big determiner of your loan will depend on your down payment. Many lenders require a 10-20 percent down payment for approval. If you cannot afford a down payment, you could be subject to a higher interest rate. Also keep in mind the type of property you are buying. Condos, mobile homes, and other properties may differ in your mortgage pricing as well as the location of these properties.
Before making an offer, make sure your mortgage has been approved and you are on the right track for financial success with your purchase! For more information on mortgages or if you are ready to start looking for a home, call Simply Referable today!
Simply Referable Can Help You Find Your Dream Home!
The small team of realtors at Simply Referable is deeply focused on creating a memorable selling experience for you and your family. Each of our team members has an area of expertise, and we strive to form lasting bonds with each of our clients. We want to be your go-to realtors every time you or a friend wants to make a change. With local experience, our realtors can help you choose a house that is just the right fit for your family, now and forever. Contact us online or give us a call at 410-983-9045.