Finding the right home is not an easy job. Once you find your home, you should be able to figure out who can be a reliable lender when you cannot bear the entire cost all by yourself. A reliable mortgage company can be handy if you select them wisely. Whether you are buying a house for living or investing, you need to consider various aspects. It is easier to get your mortgage loan rather than loan for buying stocks.
Here are some handy tips that can help you before you get a mortgage:
Some fees are mandatory and cannot be avoided, while in all other cases, it can be waived or negotiated to reduce the fees. A good estimate will show you how much fee you are expected to pay and for what items. Make sure that you clearly understand your lender’s expectations before signing the contract. Some of the fees generally considered in mortgage are:
Interest rate is very important and so is the APY (annual percentage rate).
Adjustable rates are always attractive on the upfront as their rate is much lower. You may avail 4 different options:
You get better interest rates from Fannie and Freddie upon selecting the 30 year interest plan. This way you can easily lock your interest rate as per your favorable terms. And in case there is a fluctuation in the economic status, you will not be affected. If there is a decrease the rate for current market trends, you will still need to pay the same rate you were locked down. The most common term where the interest is locked is for 15 years or 30 years and some even opt for 20 year or 5 ARM term loans and this means higher interest rates.
Some people just make the minimum payment and keep procrastinating the remaining dues. It can so happen that in less than just 2 years you may end up paying more money that the actual house price. Make regular payment of interest and principal or at least the interest amount in full. Paying on time and paying more towards the principal will place you in a better position than you are right now.
Some lenders waive the mortgage insurance. Check with them to see if you can get the offer. If not check if your debt to home equity ratio is such that you can get a waiver on the insurance payment.