What to Look for When Considering a Mortgage

Buying a house is a big decision and can be stressful. But there are some key factors that you definitely should not ignore. Here is a basic primer of things you definitely need to consider.

Be Upfront and Honest with Your Salary 

Especially when you’re having initial discussions with a potential lender. Be completely upfront. You don’t want to be in a situation where you are pre-approved for a certain amount based on out-of-date records, and then have a contract fall through because you could not ultimately get the mortgage. Be especially upfront with your credit score. There are some loans that will require a certain credit score so you may want to get that in order before you move ahead. 

Consider All Your Loan Options

There are three main factors when considering a loan: term length, interest rate, loan type, according to the Mortgage Guys

The term length is how long you have to pay off the loan. Generally, homebuyers will have the option to get a 15-year or 30-year mortgage. And typically, the longer the mortgage, the lower the monthly payments. 

Interest Rate Type will usually be fixed or adjustable. Most homebuyers will opt for a fixed rate. Adjustable interest rates can often be better than fixed, but you are always at risk of rates fluctuating and going higher than a fixed rate. 

Loan type

There are three main types of loans: conventional, FHA and special government program loans. Conventional loans are your typical bank or credit union loans. FHA loans are insured by the Federal Housing Administration and allow for smaller down payments; they are available to people with lower credit scores but come with certain restrictions. The third of of loan are special programs for various groups, which are granted from the government, such as VA loans for veterans or U.S. Department of Agriculture loans for people living in rural areas.

Don’t Be Afraid to Compare Lenders

Buying a house is a big investment, so don’t feel bad about seeking another opinion. Don’t be afraid of making this clear from the beginning when you speak with a potential lender. You may be keeping some funds set aside for furniture or furnishings like Ove Decors or a HVAC or air from Jackharrisonair.com