When you’re shopping for a home, choosing the right mortgage is nearly as important as finding your dream house. The mortgage rates and loan structure you select can have a major impact on your long-term financial health, so it pays to collect as much information as possible before making this critical decision. Below are a few questions to ask before signing for a home loan.
4 Questions to Ask Before Choosing a Mortgage
1. What’s the Interest Rate?
While the mortgage rate may not make a huge difference to your monthly payment, it can have a dramatic impact on the total amount you pay for the house. Over the life of the loan, a difference of just 1% in the interest rate can mean paying tens of thousands more for the property.
2. Is the Mortgage Rate Fixed or Adjustable?
The interest on fixed-rate loans remains stable for the life of the mortgage, which helps make your monthly payment more predictable. Adjustable-rate mortgages, on the other hand, respond to changes in the market. Both types have their benefits and drawbacks, but it’s important to understand how a mortgage works before signing.
3. What Will I Have to Pay Upfront?
In addition to the down payment, you might also have to pay other one-time fees at closing. While this can be a financial stretch, paying these costs will usually result in a lower overall mortgage rate, saving you a lot of money in the long run.
4. Are There Penalties for Prepayment?
Making extra payments can be an excellent way to cut down your balance, but some lenders will charge extra penalties. Knowing about this and other fees can help you estimate the total cost of the loan.
Buying a house can be extremely stressful, which is why Movement Mortgage in North Haven, CT, is committed to making the process as easy as possible. As one of the country’s fastest growing home loan providers, they pride themselves on being different from other lenders, making it easy to understand your options and get the best mortgage rate possible. To find your ideal home loan, visit the website, or call (203) 215-5133, and follow them on Facebook for updates and news.