Buying a home is a big step in anyone's lifetime. However, applying for a mortgage can make you a little hesitant to move forward if you don't know where to start. See the common questions and answers below to help you navigate this complex journey. And don't forget to visit Assist2Sell if you need to get the previous home off your hands affordably.
Why do I need a mortgage?
Homes are expensive, and if you don't have all the cash to put in to purchase your home in full, then a mortgage can help you secure the property of your dreams. Just make sure you understand everything involved with securing a mortgage - which includes paying close attention to your credit score and taking steps to improve it, if necessary.
How does a mortgage work?
As a mortgage is essentially a loan, you'll need to pay back this amount over 20 to 30 years to your lender with interest.
What can affect my ability to qualify for a mortgage?
Many factors can influence your ability to acquire a mortgage, including your debt-to-income ratio, you income, the down payment you can make, and the general condition of the home.
What are the different home loan options I can apply for?
The importance of choosing the right loan option when buying a property is imperative as this is a lifetime commitment of payments.
- Conventional loans. Go with this option if you have a fair amount of savings, a good credit score, and a regular income.
- FHA loans are easier to acquire if you credit score is not that great. The down payment amount required is also relatively low, which makes FHA loans a popular option among first-time home buyers.
- VA loans are for those who have served in the military or are currently serving. VA loans have many benefits, including that there is no down payment required and there are no closing costs in certain cases
- USDA loans are there to support rural property ownership in sparsely populated areas. They are a hundred percent guaranteed home loans to be used towards building a modest property.
- Portfolio loans are lender specific and require you to have a good income and a good credit score.
These are some of the more popular questions you may encounter when inquiring about a mortgage. Hopefully, you've been given a few helpful answers to help guide you on the best way forward.