When you're in the market for a new home or a new home loan, there are many things to know about how each loan type works and which type you need. Here are three popular home loans that can save you money and help you have a better standard of living. Buying a new home can be easier when you have a fixed mortgage loan. With this type of loan, your interest rate does not fluctuate, so your mortgage payment, independent of taxes and homeowners' insurance, stays the same month after month and year after year.
It's a great way to keep the mortgage payment regular and to hedge against inflation. If you will be staying in your home for at least four years, a fixed mortgage is a good way to make your mortgage more affordable and to keep any interest rates changes at bay. If there is a significant drop in interest rates, or if your credit improves by a significant amount, it may be a good financial decision for you to refinance your loan.
Refinancing your mortgage allows you to get a better interest rate and to benefit from a lower total loan amount if you have built up equity.
It's a great way to keep the mortgage payment regular and to hedge against inflation. If you will be staying in your home for at least four years, a fixed mortgage is a good way to make your mortgage more affordable and to keep any interest rates changes at bay. If there is a significant drop in interest rates, or if your credit improves by a significant amount, it may be a good financial decision for you to refinance your loan.
Refinancing your mortgage allows you to get a better interest rate and to benefit from a lower total loan amount if you have built up equity.
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Purchasing a new home, refinancing an existing loan or getting a reverse mortgage can be a confusing and sometimes a frustrating process.
We believe simplicity is the key.
It also helps to have a trusted mortgage professional on your side to help you navigate your way through the mortgage process.
Key City Lending will help in achieving all your mortgage goals.
Key City Lending has made the mortgage process easier and more efficient by integrating technology with our outstanding customer service provided by our professional and knowledgeable loan officers.
We believe simplicity is the key.
It also helps to have a trusted mortgage professional on your side to help you navigate your way through the mortgage process.
Key City Lending will help in achieving all your mortgage goals.
Key City Lending has made the mortgage process easier and more efficient by integrating technology with our outstanding customer service provided by our professional and knowledgeable loan officers.
If you're looking for a fixed mortgage for a refinance or new home purchase, you can get a no obligation consultation to find out which loan is best for your financial needs.
Each of these options presents its own benefits to specific buyers, depending on their lifestyle and financial situation.
Many buyers seek out of a fixed mortgage because the interest rate will stay the same over the entire life of the loan.
A 30-year fixed mortgage allows buyers to keep a mortgage payment the same for 30 years instead of paying more when interest rates go up.
Each of these options presents its own benefits to specific buyers, depending on their lifestyle and financial situation.
Many buyers seek out of a fixed mortgage because the interest rate will stay the same over the entire life of the loan.
A 30-year fixed mortgage allows buyers to keep a mortgage payment the same for 30 years instead of paying more when interest rates go up.
A 15-year fixed mortgage is a loan whose interest rate stays the same for the duration of the loan.
For example, on a 15-year mortgage of $250,000 with an interest rate of 4.25%, the monthly payments would be about $1,881.
So, the interest rate of 4.25% stays the same for the life of the loan.
People who desire a predictable, fixed deduction from their monthly budget, want a shorter loan term, and can tolerate a higher monthly payment are well-suited for 15-year fixed mortgages.
The pros of a 15-year fixed mortgage: it's a predictable monthly payment; the paydown on a 15-year fixed is half the time of a 30-year fixed; the rates are usually lower than a 30-year fixed mortgage; and it's relatively simple and maintenance-free once you lock the rate (you don't need to worry about rate fluctuation).
For example, on a 15-year mortgage of $250,000 with an interest rate of 4.25%, the monthly payments would be about $1,881.
So, the interest rate of 4.25% stays the same for the life of the loan.
People who desire a predictable, fixed deduction from their monthly budget, want a shorter loan term, and can tolerate a higher monthly payment are well-suited for 15-year fixed mortgages.
The pros of a 15-year fixed mortgage: it's a predictable monthly payment; the paydown on a 15-year fixed is half the time of a 30-year fixed; the rates are usually lower than a 30-year fixed mortgage; and it's relatively simple and maintenance-free once you lock the rate (you don't need to worry about rate fluctuation).
An adjustable-rate mortgage, or ARM, has an introductory interest rate that lasts a set period of time and adjusts annually thereafter for the remaining time period.
After the set time period your interest rate will change and so will your monthly payment.
The initial interest rates for adjustable rate mortgages are normally lower than a fixed rate mortgage, which in turn means your monthly payment is lower.
If you only plan to stay in your home for a short period of time ( 5-7 years), an ARM loan might be advantageous to you because you plan on moving or selling your home before your initial mortgage rate adjusts.
After the set time period your interest rate will change and so will your monthly payment.
The initial interest rates for adjustable rate mortgages are normally lower than a fixed rate mortgage, which in turn means your monthly payment is lower.
If you only plan to stay in your home for a short period of time ( 5-7 years), an ARM loan might be advantageous to you because you plan on moving or selling your home before your initial mortgage rate adjusts.
Another name for a jumbo mortgage is a non-conforming mortgage.
This is a loan a lender makes you that doesn't "conform" to the guidelines of Fannie Mae and Freddie Mac.
Created by Congress in 1938 and 1970 respectively, Fannie Mae and Freddie Mac provide stability and affordability to the mortgage market by buying "conforming" mortgages from lenders, which gives lenders liquidity to make more mortgages.
Fannie Mae and Freddie Mac only buy mortgages meeting their guidelines for down payment, credit score, post-closing reserves, and loan amount.
This is a loan a lender makes you that doesn't "conform" to the guidelines of Fannie Mae and Freddie Mac.
Created by Congress in 1938 and 1970 respectively, Fannie Mae and Freddie Mac provide stability and affordability to the mortgage market by buying "conforming" mortgages from lenders, which gives lenders liquidity to make more mortgages.
Fannie Mae and Freddie Mac only buy mortgages meeting their guidelines for down payment, credit score, post-closing reserves, and loan amount.
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