Obtaining a Home Mortgage Loan

by | Jul 17, 2012 | Money And Finance

All of the hype in the media about mortgages might have you concerned about shopping for financing. There are plenty of options for borrowers to find the perfect home mortgage loan. All it takes is a little knowledge and dedication to find the perfect loan for your needs. If you are just starting out, you will need to determine the type of loan that you need as well as how much you qualify for.

This is easy to determine with the help of a reputable bank. Finding a mortgage lender that will help you every step of the way can make the mortgage lending process less overwhelming. A bank can take all of your preliminary information including your income, assets, credit and proposed value of a home to pre-qualify you for a loan. Once you have a pre-qualification in your hands you have more buying power when you look at homes. Realtors and homeowners selling their homes are more likely to talk to those that have been pre-qualified for a loan.

When you are talking with your banker, you need to decide what type of home mortgage loan you want. If you think you will be in your home for a long period of time you might want to look into a fixed-rate loan. This loan offers the same mortgage payment and rate over the life of the loan. They are offered in increments of 15 years – 30 years. The shorter the term of the loan, the quicker your home will be paid off. It is important to remember that the shorter the term of the loan, the higher your monthly payment will be.

If you think you might only be in your home for a few short years, you can look into an adjustable-rate mortgage or ARM. These loans offer a lower initial interest rate. The downside is that after a specified period of time the rate and your payment adjust according to the current market rates. This could raise your payment significantly. ARM loans are offered in three to 10-year increments. If you qualify for an ARM, you can try to obtain one that will not adjust during the length of time you expect to be in your home.

Weighing the pros and cons of each type of loan will help you determine the best home mortgage loan for you. The most important thing to remember is to use a reputable bank to help you with your mortgage needs. A banker who is there to answer all of your questions will help you get the loan that fits your needs the best.

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