Suppose you’ve never had a mortgage before. Of course, knowing what to expect and ensuring you’re ready when you find the house of your dreams is essential. But just what do you need to know about that first time mortgage? There are quite a few things.
The first thing to know is what you can get approved for. While you won’t get full approval for a mortgage until you find the house you want and apply, you can get preapproved to determine the price range you should be looking in. In addition, the preapproval will give you an idea of your interest rates and costs, so you can decide how much you’re willing to spend and how much you’re able to.
Once you’ve gotten preapproved, you can start looking for the house you want. And from there, you will want to start the official mortgage process. Keep in mind that each loan provider you go to will have a slightly different offer. In addition, they’ll give you somewhat different terms and interest rates, and that’s something else to consider.
When you’re ready to apply for your mortgage, you’ll want to look at different options to find the terms that will work best for you. That means looking at how long the mortgage is (30-year mortgages are the most common, but you can also choose 15-year, 20-year, or other lengths). You’ll also want to look at the interest rate you’re being offered.
First Time Mortgage Interest Rates
Interest rates will vary based on several factors, but one is your credit situation. If you have good credit, you’ll likely be able to get a reasonable interest rate. If you have poor credit, however, you’ll probably get a lower interest rate, or you may even need to get a different type of loan entirely. Again, working with a professional can help you understand your interest rate and get the best one possible.
Your down payment is another critical piece of the puzzle. Depending on how much you’re able to put down, you may be able to change the terms of your mortgage as well, getting a shorter or longer term and better interest rates.
The good news is that you can get a house with just about any down payment available. However, you may need to look at different options and ways of getting there. FHA loans can be a good option for those who don’t have a large down payment, for example. And for first time mortgages, that can be a great option.
If you’re looking for a first time mortgage or more information about them, talk to LoanDepot to find out your options and how you can get the mortgage you need.