Home | Real Estate Investment Loan
To start off, be aware of interest rates! You need to locate the lowest rate you can find (this should be a no-brainer). Also, ensure you get a fixed interest rate. Variable rates are risky because they can go up after the opening rate runs out. Be mindful of what you can afford. There is no need to strap yourself financially right out of the box. Remember that a good rule of thumb is you don't want your mortgage to exceed 20% of your income after taxes. If you are a veteran your state might offer a program with competitive rates. As well as being authorized for a VA loan, which does not necessitate a down payment, mortgage programs for veterans more often than not have much lower rates than banks. Find out if your state has a veteran's mortgage program. Also, it would probably behoove you and your spouse to rent at first. A lot can change during the early years of marriage while the two of you are figuring out where you want to live and what you want. A big advantage of waiting is it allows you to save money which you can use on a down payment. Incorporating a down payment when acquiring a mortgage can remove that pesky home owner's insurance expense. Home owner's insurance (not to be confused with home insurance) is a fee the banks charge when a borrower cannot afford a down payment. The monthly home owner's insurance payment is tied in with the monthly mortgage payment (note they are separate entities) and usually is stretched over ten years. This separate capital protects the bank in case the house ever gets foreclosed. Another plus to waiting is it allows you more time to increase your credit score, which could give you a better rate. To increase your credit score, obtain one credit card for you and your spouse with a low max limit and low interest rate, and make payments on it each month on the dot. These well-timed payments will be given to the credit bureaus and will shed you in good favor with them. Another important thing to consider is getting a 15 year mortgage instead of a 30 year mortgage. Then, make bi-weekly payments instead of monthly. Doing this will make 13 payments per year instead of 12, and you will pay off that 15 year mortgage in about 11 years! You will also be building valuable equity in your home. Most banks will be glad to help you with this. In fact, most banks have programs which will automatically take the money from your account bi-weekly (I have mine set for paydays). This is great because you don't have to be bothered with writing a check and lose sleep if your payment will make it on time. Just make sure the money is there! Purchasing a home for the first time can seem daunting, but being patient will help in the long run. Remember, most importantly, to be patient when buying a home. There is a lot to think about and being hasty will not help you in the long run.
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