When it comes to first time home buyer loans, a little research can save you thousands of dollars over the life of your mortgage. |
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A wise consumer selects a mortgage lender
prior to shopping for a home. You see, first time home buyer loans can
end up costing you a lot more than you bargained for if you shop for your home
first.
What often happens is you fall in love with
a beautiful home that is on the outside range of what you can afford. And
because you have invested interest in this thousands piece of real estate
you’re more inclined to go into a loan situation you can ill afford.
To make sure you can realistically afford your mortgage payments, it’s best to understand all the potential costs upfront before you fall in love with that dream home that is really outside your financial comfort zone.
It will take some research and comparison
shopping in order to find both the best lender and the best in first time
home buyer loans.
The loan package best suited to your needs
will offer you terms you can handle now and in future. It’s important when
looking for first time home buyer loans you take into account your future
plans. For instance, are you planning on starting a family? If so, it’s
important to consider the potential reduction in your family finances if you or
you spouse decides to take some time off to raise the children).
Further, if you have poor credit, you’ll be
required to pay a higher rate of interest than those who have a good credit
rating.
When it comes to first time home buyer
loans, the amount of your down payment will also be taken into account when
your interest rate is calculated. Think of it this way, the larger the down
payment, the better the interest rate. So, before locking yourself into one of
the first time home buyer loans currently on the marketplace, you’ll want
to consider the advantages of contributing a decent down payment. This will keep
both your interest rate and your payments much more reasonable.
Among the options for first time home
buyer loans are variable rate and fixed rate mortgages. The first fluctuates
over the course of your mortgage and the later keeps payments the
same.
Another factor to consider is your debt to
income ratio. In other words, the amount of money you bring in opposed to the
amount that goes out. When determining your debt to income ratio you must take
things like car payments, student loans and credit card balances into
account.
There are programs available to assist
first time home buyers in obtaining a loan. Talk to your lender and do some
research of your own to discover the best option for you.
Remember, when shopping for first time
home buyer loans no question is stupid. It’s very important that you
understand the ins and outs of any mortgage loan prior to signing on the dotted
line.
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