subject: Mortgage Loan The Basics [print this page] When you decide its time to buy a house, one of your biggest jobs will be to get the right mortgage loan. A great mortgage will have affordable monthly payments, a low interest rate, and a repayment term that fits well with your life trajectory. Before starting to shop for a mortgage loan through CreditNowUSA, learn a little bit about the basics, especially the terminology.
Mortgage loans can either have a fixed interest rate or a variable interest rate. A fixed rate is the same for the entire repayment period on the loan, and locking in a rate will guarantee that your payment never goes up. A variable rate, on the other hand, will stay the same for an initial period, usually five to seven years. After that, it adjusts annually based on an index rate. That means your payment could go up or down, and it often goes up.
The repayment term is the length of time before you pay off the full amount you borrowed. The standard repayment term on mortgage loans is 30 years, which is ideal for young people who have many years before retirement. Older borrowers or people who want to own their home before 30 years are up may opt for a 15-year repayment term instead. This has a monthly payment of about 150% of a 30-year loan, but half as many payments.
The last major thing to understand with a mortgage loan is the down payment component of it. When you buy a home, the lender requires that you pay for part of the purchase right away and only borrow a percentage of the homes value. The lowest down payment available is generally 3.5%, but if you put less than 20% down, youll also have to pay for mortgage insurance to compensate the lender for the added risk.
CreditNowUSA can match you with just the right lender for your mortgage loan. Each lender will evaluate your credit history and income, quote an interest rate, calculate your monthly payment, and approve or deny the amount you want to borrow.
For more information, go to Mortgage Loan at http://www.creditnowusa.com/Mortgage-Loan
