First
Time Homebuyer
For a first time
homebuyer, applying online for a
mortgage loan makes the experience easy. You
have plenty of time to compare rates and terms to find the best financing for
your situation. With just a few steps, you can secure financing for your home
with the lowest possible rates.
Select Your Mortgage
Terms
Mortgage terms affect
both your interest rate and payment. With a large amount of flexibility, lenders
allow you to tailor your loan to fit your budget needs. So if your goal is to
purchase the most with your income, look into an adjustable rate mortgage with
initially low payments.
For security, fixed rates can also have reasonable rates. For even lower rates,
you can purchase reductions by paying points at closing. One point equals one
percent of the principle. Paying points is affective if you keep your
mortgage
for at least seven years in order to recoup the cost of buying the rate
reduction.
The length of the loan will also affect your rates and payments. 15 year
mortgage provides you with a cheaper loan, but payments are about a third higher
than a 30 year mortgage.
Research Your Mortgage
Lender
Even a difference of an
eighth of a point in rates can save you thousands of dollars. The easiest way to
save money on your home's purchase is by finding the lowest costing loan.
With online
mortgage companies, in just a few minutes you can request loan
quotes without hurting your credit report. Every time a potential creditor
accesses your report, it temporarily hurts your score.
Rates are one way to evaluate loans. But closing costs can also add up to
thousands. That's why the APR number is important. It gives you the total cost
of the loan. But if you plan to move or refinance, focus on low closing costs
rather than low rates.
Apply Online
When you have found the
right lender, you can start your home loan application online. Even if you
haven't found the right house, you can still get pre-approved and lock in your
rates.
With online financing companies, your paperwork is expressed mailed to you. You
complete the forms with a notary's seal. Working with your real estate agent,
Escrow Company, and seller, the date of sale can then be finalized.
Mortgage Glossary9
