How To Get Your First Mortgage
So, you're ready to take the plunge and buy your first house. This probably means that you're also looking at getting your first mortgage. This is a big step, one not to be taken likely. In order to make the best decision, there are a few factors you'll need to consider.
First of all, you should know that the more money you can put down, the better it will be. This will lower your monthly payment, allow you to avoid mortgage insurance, and you will pay much less interest over the life of your home.
Mortgage insurance is a fee assessed on your mortgage if you don't have at least twenty percent down. This fee is there to cover the bank for the riskier mortgage. If you don't have enough money down, you'll have to pay this. Not the end of the world, but its nice to avoid.
The number one most important thing to figure out when trying to find a mortgage is how much you can afford. Overextending yourself on high mortgage payments is the path to financial ruin, so be sure to consider carefully what you can pay each month. One common guideline is that your mortgage should cost you no more than 35 percent of your take home income each month.
After you have sorted out the matter of how much you can afford, you'll need to decide on which type of mortgage you want. The class standby is the 30 year fixed rate mortgage, which means you lock in a fixed interest rate over 30 years of payments. You can also get mortgages with varying rates, and shorter terms. Be sure you research all these options.
This may all seem a little overwhelming at first. The key thing to remember is that if you really can't afford to move in somewhere, don't overextend yourself trying. Just keep on renting. Its OK.
This covers just a few of the basics of shopping around for a mortgage. The key is to seriously look at your finances, and do all the proper research before pulling the trigger. Get the best rates, get something you can afford, and enjoy your new home!
First of all, you should know that the more money you can put down, the better it will be. This will lower your monthly payment, allow you to avoid mortgage insurance, and you will pay much less interest over the life of your home.
Mortgage insurance is a fee assessed on your mortgage if you don't have at least twenty percent down. This fee is there to cover the bank for the riskier mortgage. If you don't have enough money down, you'll have to pay this. Not the end of the world, but its nice to avoid.
The number one most important thing to figure out when trying to find a mortgage is how much you can afford. Overextending yourself on high mortgage payments is the path to financial ruin, so be sure to consider carefully what you can pay each month. One common guideline is that your mortgage should cost you no more than 35 percent of your take home income each month.
After you have sorted out the matter of how much you can afford, you'll need to decide on which type of mortgage you want. The class standby is the 30 year fixed rate mortgage, which means you lock in a fixed interest rate over 30 years of payments. You can also get mortgages with varying rates, and shorter terms. Be sure you research all these options.
This may all seem a little overwhelming at first. The key thing to remember is that if you really can't afford to move in somewhere, don't overextend yourself trying. Just keep on renting. Its OK.
This covers just a few of the basics of shopping around for a mortgage. The key is to seriously look at your finances, and do all the proper research before pulling the trigger. Get the best rates, get something you can afford, and enjoy your new home!
About the Author:
David Williams is the owner of the Denver Home Mortgage site, devoted to helping you find the mortgage brokers in Denver and more.
posted by Credit Counseling at
8:29 AM
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