A new home can be exciting and fun to find, but getting a loan is usually not. It’s not like you can apply for pay day loans on the phone to cover the cost. Here are a few ways to make sure you get your money in order for the home of your dreams.
Determine Your Budget
There are many rules of thumb when it comes to what you can afford. Why stretch yourself more than necessary? Depending on where you live, you can figure out what monthly payment you can easily afford and whether you’d be comfortable with a 15 year or 30 year loan term. Then you can just use an online calculator to determine what your general loan amount would be based on that. Or see what 2-4 year’s salary would amount to in your area. In the end, just make sure you don’t get a monthly payment more than you could afford even if you had to switch jobs.
Shop Around for the Best Deal
Once you know what you can afford, you can start looking for the best interest rate. The shorter the loan term, the lower the rate you can get. Make a list of your requirements and then call around or go online to get multiple quotes. If you have a solid credit score and know what you need, you can find a fair quote pretty quickly.
The paperwork is never fun though. Make sure that you read all of the quotes thoroughly. Some terms seem great until something is off in the fine print. Read carefully.
Make Sure You Are Comfortable
No matter which quote seems the best, make sure their terms are okay for you. You will want to make sure there are no pre-payment penalties and that you are getting every discount you can. If you or your spouse is a teacher or police officer, you may be entitled to an even lower rate. If you come across the deal with the loan terms you need, the rate that you want, and they will pre-qualify you so you can make real offers on the home you end up choosing, you may have found your deal. Just follow your instincts.
In the end, finding the right mortgage loan is about finding the most balanced deal for yourself. Good luck!
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