Shopping for your first home is both exciting and scary. It feels like a never ending process filled with questions that no one wants to ask. Recent borrowers have expressed that it is similar to buying a mattress. Nothing is the same so comparing is virtually impossible. How much can I borrow? What is my payment? How much money will I need for settlement? Is that the lowest rate?
It’s difficult to ask questions when you are not even sure what to ask. Everyone you meet has an opinion. Pay PMI don’t pay it. Pay points. Never pay points. What are points? Does running my credit bring my score down? Do I need to have all of my savings in the bank before I apply for a mortgage?
Finding the right house is a very emotional experience. It is something you know when you see it. Walking up the front walk you feel it. Emotion should not be involved with getting a mortgage that is right for you. Each borrower has different needs. Each loan should be tailored to the individual borrower. Finding the right balance between your monthly payment and you initial cash outlay is key to making your house a home.
Questions are something we both need to ask. As your mortgage banker I may have more questions of you than you do of me. Answering my questions will help me find the balance you need. How much you are able to borrow may be more than you feel you can handle. You may need to reel us back in a little bit to reach your comfort zone. Your payment is calculated including your taxes and insurance and can vary based on the term of your loan. Terms typically are 15, 30, or 40 years. The longer the term the lower the payment. How much money you spend can depend on a lot of factors. The type of loan (Conventional or FHA), how much the real estate taxes are, the county you are buying in, and if the seller is contributing toward the closing costs. My job is to find you the lowest rate for your circumstances. Sometimes the lowest rate does not provide the lowest payment. In today’s environment you can have a lower payment with a higher rate if we can make the PMI go away. The goal is to find a happy medium between a monthly payment and how much money you need to spend.
