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Getting a new house can be a like a milestone to any person. It brings out a feeling of fulfillment, especially for those people who would like to live on their own and be independent. But getting a house is not as easy as you would think. There are different kinds of factors that you have to consider before getting your very own house. Here are the most common factors that you need to think of before getting a mortgage.
Credit Score is a number that lenders get to have an assessment on how you’ll be paying off your loan. Your credit score is a reflection of all your loan and credit card payment history. People who have a low credit score has less chances of getting their mortgage approved.
Each state like Tennessee has different interest rates. It would be better to get a broker’s professional advice to get an accurate computation on how much your mortgage will be. Rural real estate can be a tad bit cheaper if compared to properties located in the city. However, it is also more complicated since you need to consider factors like local zoning, septic system and even the property’s history to name a few.
Check the price range of each house within the neighborhood to get an assumption of how much the house is. The loanable amount will be the total value of the house deducted by your down payment. So the larger your down payment is, the lesser amount you’ll have to pay every month.
Down payment is the fee that you have to pay before you sign the contract. It determines how much your monthly payment will be.
Your mortgage length or loan term determines how long you’ll pay your loan. The shorter your loan term is, the higher your monthly payment will be. However, since your loan term is short, you’ll be able to finish your mortgage quicker and thus save you money in the future.
Homebuyers can choose from fixed rate and adjustable rate. Fixed rate means that your mortgage will stay the same until the end of your loan. Adjustable rate means that you’ll be paying lesser monthly payments in the first few months, but will be subject to change depending on the housing market.
Homebuyers can choose from three different basic types of loan which are VA loans for eligible veterans or their surviving spouses, FHA or mortgages insured by the Federal Housing Administration, and conventional loans. Each has their own pros and cons so consult a real estate broker to know more about these types of loans
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Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. This is not a commitment to lend. Programs, rates, terms and conditions are subject to change without notice.
