Selecting The Right Mortgage For Your New Home Purchase

It is the dream of most Americans to own their own home.  There is something special about buying a home especially your first.  With the purchase of a home comes endless possibility.  The space is yours and therefore can be manipulated in any manner you desire.  Your desires can be fulfilled through home improvements, renovations and landscape design.  The one thing that occurred within the past few years is that the ability to purchase a home has become harder.  There are more stringent restrictions on being approved for a mortgage.  This is largely due to the crisis that was created with the housing bubble a decade ago.  Home prices were largely inflated, home loans were given out without a lot of discretion and people were buying homes that were not necessarily qualified.

In order to be sure you are ready for the financial commitment of owning a home and taking on a mortgage it is important to consider a few things.  Ask yourself the following questions to determine if you are really ready to own a home.

The first question to ask yourself is why it is you would like to purchase a home.  This question will also help to determine the type of mortgage you will qualify for as well.  What is your plan for the house?  Is the purpose of purchasing the home so that you can rent it out and use the income to subsidize your income?  Are you looking for a long term investment?  Are you looking for a home that you can move into, live comfortably and do home improvements to increase the homes equity and then sell the home for profit? Are you looking for a home to settle down in for an extended period of time?  These questions will help to determine if you should apply for a fixed rate, ARM, FHA or another type of mortgage. If you have been in the military you may qualify for a VA loan. 

Next it is wise to understand exactly what you can afford.  Many people found that the home loan they were preapproved for above the amount in which they could actually afford on a monthly basis.  This is part of the reason we ended up in a housing crisis.  Many people could not continue to make the large mortgage payments they were approved for and therefore ended up in foreclosure.  Take into account your income to debt ratio along with a safety net that you would like to have for savings each month.  This will help ensure that you purchase a home in which the monthly payment is affordable and within where you feel comfortable not where the banks feel comfortable at.  Be sure to account for hidden costs as well as utilities, taxes and insurance.

The point at which you are in your life as well as your five year plan should be considered as well.  Both can affect the type of mortgage you should look into getting if you decide to buy a home.  Perform a cost analysis to determine if buying or renting is a better option for you.  Buying is always better if you the growth in equity and expenses of owning outweigh the expenses that come with renting. 

Cross Country Mortgage in Brighton, Michigan provide mortgage services for clients including new home loans, refinancing, reversed mortgages, new purchase home mortgages and home equity loans to the entire Livingston County area including Brighton, Howell and Livingston County. Cross Country Mortgage Brighton, MI at http://brightoncrosscountry.com/.

Important Decisions When Choosing A Mortgage Lender

Choosing a mortgage lender is important.  Many people don’t understand just how crucial the lender can be to helping you find the right mortgage for your new home.  Each lender is unique and offers different options; the fate of your home loan application is in their hands.  Some lenders tend to be more strict than others complying to the rules fully while others are a bit more lenient and work around issues that other lenders may not.   Here are some financial tips to consider when looking for a lender to service your home mortgage needs.

• Before you go looking for a mortgage lender know exactly what you are looking for.  Determine what type of home loan that you think would work best for your situation.  Are you looking to purchase your first home?   You may consider a loan with special rates for first time home buyers.  A good mortgage lender will tell you all of the loans you qualify for and will show you which option works best for your situation.  They will then let you decide which you believe is in your best interest. 

• Look into the different mortgage rates that are currently available. This can be done online or in person with a lender.  The more you know before you begin looking for a mortgage and a lender the better prepared you will be to make a thorough decision. 

• Different types of lenders have their advantages and disadvantages.  Some mortgage lenders actually lend their own money while other lenders will broker your mortgage out to a variety of lenders and look for the best option for your home loan. 

• Compare the fees that are charged between lenders.  Ask about upfront costs, closing costs and any hidden fees that are tied into the principal of the mortgage.  Avoid rolling last minute costs into your principal loan amount as the interest that you pay on that small amount of principal can really add up over time. 

• Talk to the referrals of the companies you are leaning towards working with to find a mortgage for you and your home.  Ask for pre-approvals as well while you are shopping for a home loan.  Between talking with referrals and considering the various pre-approvals you have been given you will most likely have narrowed down your choice of mortgage lenders to just a few if not the one.  If you are stuck with a decision narrowed down to two lenders talk with your real estate agent.  They may have past experience working with the different lenders in the past and be able to help you decide.

Choosing a mortgage lender is an important process of buying a home.  Between hiring an agent to represent you in buying your home and hiring a lender to finance your new home you have a lot of decisions to make.  A lot of buying and financing a home comes down to your gut reaction as well.  Trust yourself and your research; both will lead you exactly where you need to be.

Cross Country Mortgage in Brighton, Michigan provide mortgage services for clients including new home loans, refinancing, reversed mortgages, new purchase home mortgages and home equity loans to the entire Livingston County area including Brighton, Howell and Livingston County. Cross Country Mortgage Brighton, MI at http://brightoncrosscountry.com/.