Financing Your First Home
1. Determine what you can afford – Each buyer is unique – and we’ll help you find out just what you can afford. Your income and your debts will typically play the biggest roles in determining your price range.
2.Figure out your funding – A range of mortgage options are available, and we’ll help you determine which can work for you – some loans require little money down. You’ll also need to consider closing costs and the escrow account for taxes and insurance. But don’t get overwhelmed.
3. Less-than-perfect credit report – Don’t worry, there are options that are ideal for those who have a few “dings” on their credit report. Work with your lender to develop an individual mortgage program based on your unique credit worthiness.
4. Loan Programs – Finding the best loan program for your needs depends on a number of factors, including: How long you’ll stay in the home; How much money you’ll put down; How you’ll finance the closing costs.
5. Tax Benefits – You may be able to deduct the interest you pay on the mortgage loan and some of the financing costs of the home, such as points. And your property taxes could be deductible. You should consult your tax advisor for more information.
6. When to Refinance – Each homeowner is unique – and we’ll help you determine if it’s the right time for you to refinance. Effective refinancing typically means lowering your current mortgage loan rate by at least one percent. You might also want to consider changing the length of your loan or receiving cash from the equity in your house.
7. Fixed-Rate Mortgages – A fixed-rate mortgage means the interest rate and principal payments remain the same for the entire life of the loan. (Taxes, of course, may change.) Advantages include consistent principal and interest payments make this loan stable your rate won’t change, so you don’t need to worry about market fluctuations. A good choice if you’re likely to stay in this house for a long time. Disadvantages include a possibly higher cost – these loans are usually priced higher than an adjustable-rate mortgage. Keep in mind that, on average, most people move or refinance within seven years. If rates in the current market are high, you’re likely to get a better price with an adjustable-rate loan.
Knowledge Is Power … Accurate Information Is Essential