Buying your first home is both thrilling and scary, partly because you also usually have to get your first mortgage. Getting your first mortgage is confusing and stressful for most people.
Since your home will be one of the biggest investments you ever make, it’s important to go through the mortgage process carefully.
Should You Use A Direct Lender Or A Mortgage Broker?
One of the first things you will need to decide when shopping for a mortgage is whether to go with a direct lender or a mortgage broker.
Dealing directly with lenders can potentially save you money because you don’t have to pay a brokerage commission.
On the other hand, a mortgage broker can find lenders that are most suitable to a borrower’s needs and can also take care of many administrative tasks involved in the process. That is what you are paying them to do.
Check Out First Time Homebuyer Programs
There are many programs available to assist first time homebuyers. For example, you may be able to qualify for:
- FHA financing,
- VA financing, or
- Other specialized programs based on where you live.
Any quality mortgage lender can provide you with a list of mortgage programs you qualify for. Often these programs can be quite helpful in assisting with your first home purchase.
Pre-Qualify For Your Mortgage
One thing you definitely want to do is to pre-qualify for a mortgage. That way you know in advance exactly what you can qualify for and how much home you can afford. This can save you a great deal of time and aggravation.
You can also find many free mortgage calculators on the Internet that will help you determine what your monthly payments might look like.
Filling out an application and getting pre-approved is a must for anyone shopping for a home mortgage.
Ask Your Lender Or Broker Plenty Of Questions
Be sure to ask questions about anything you don’t fully understand. For example, you need to understand:
- The difference between fixed rate and adjustable rate mortgages
- What fees may be charged to you (some fees, frankly, can be avoided if you shop around)
Buying a home is not really different from buying anything else, it’s just a much larger purchase. By educating yourself and asking questions you can get the best deal possible for your first home mortgage. And remember, never sign anything you don’t completely understand.