If you are in the market for a home for the first time, you have more to think about than just the type of house you’re looking to buy. With home buying comes the need to apply for a mortgage, which can be it’s own complicated process if you’re not well-versed financially. However, by working with a good mortgage company, you can find the options and mortgage loan rates that will work best for you.
First, make sure that you know the differences among types of mortgages. The Federal Housing Administration (or FHA) offers loans for first-time home buyers that tend to be reasonable in terms of mortgage loan rates and interest. Unlike traditional mortgages, FHA loans don’t require a 20% down payment and can be as low as 3.5% down. There are also other types of loans that can save home buyers money and make it easier to get started owning a house.
There is also the interest rate to worry about no matter which type of loan you receive. The average rate for a 30-year fixed-rate mortgage is 3.89%, though this can change every week. However, not all mortgages can last 30 years. Mortgages for 10, 15, or 20 years are also becoming popular options for home buyers who don’t want to pay back a loan for such a long period of time. Variable rate mortgages are also available, but this means that the interest rate could go up or down without warning.
Much of applying for a mortgage depends upon your credit score. The mortgage loan rates you receive may depend on how good or bad your credit is. The higher a credit score, the easier it is to get a loan. In many cases, your credit score must be high enough to qualify for a mortgage. Before signing on for a mortgage, however, it is important to check a credit report to make sure everything is accurate.
No matter which mortgage loan you receive, however, it’s important to budget for all of your home buying costs. Don’t forget to add closing costs, lawyer’s fees, home inspection charges, and other assorted costs. Have more questions about home mortgage rates? Leave a comment below. More info like this.
