A Guide To Mortgages
A Guide To Mortgages
A Guide To MortgagesBuying a house of your own, which you can do up the way you like, watch your kids growing up in, and relax in when you're retired, is a dream for many Americans. You can make this a reality by taking a mortgage. Before doing so, you should understand this kind of loan so that you are prepared when you visit the financial institution lending you the money. Mortgages are of different kinds, and you should choose one which fits your profile. Here's a guide to doing so- * Even before you look for a house, you should determine how much debt you can afford. Many financial institutions will prequalify you to borrow a certain amount. Looking for houses within this range will inspire confidence in the person selling you the house, that you are a serious buyer. * Check your credit report so that you can be sure the information provided is accurate. Lenders will use it to evaluate your application, so it is best to be prepared beforehand. Even if your credit history is poor, have an explanation ready for past incidents. Show that your present ability to repay loans is better, to improve chances of getting mortgages. * You can choose to pay the loan back over a period of fifteen to thirty years. The rate can be fixed or variable, depending on market conditions. * If you plan to stay in your house for more than six to seven years, a thirty year fixed rate mortgage is the best option. The fixed rate provides stability, while the long period for repayment lowers the interest rate. * Market rates can decline in the long term, but you can choose refinancing options if your credit history remains good, and you have sufficient income. * Compare a minimum of six lenders in your area before you take a decision on which financial institution to go for. Credit unions are able to offer mortgages at lower rates because they enjoy tax advantages. Joining one is easy, as long as you meet their criteria, which can be location, religion, or workplace based. Other options include banks which offer mortgages. Phoenix has several financial institutions to which you can apply for a loan of this kind. One such is Vantage West Credit Union, the largest of its kind in Southern Arizona, with over $1.1 billion in assets. It serves more than 105,000 members, and has been in operation since 1955.