As 2017 draws to a close, here is a prediction you can confidently make: more people will continue to buy homes. It might be that you are one of those people. If so, then one of the most important things you may be thinking of right now is to take a mortgage.
If you are a first-time home buyer, here are a few mortgage tips that may be worth knowing.
It is best to borrow only what you can pay comfortably
Rookie mortgage applicants overstretch themselves while paying their mortgages. They expect that their income will increase, and thus take a higher mortgage than they should. That is a bad idea.
Start by finding out how much you will need to pay every month by using a home mortgage calculator from a Utah lender. Then apply for only the amount you know you can pay for without struggling.
You need not make a large down payment
Do you need to make a down payment of at least 20 percent to qualify for that mortgage? Well, lenders say that nothing could be further than the truth. There are loan programs that will allow you, if you are qualified, to take a loan without making a down payment at all, for instance, VA loans.
Others allow qualified borrowers to put down payments as low as 3 percent.
You can get a mortgage with imperfect credit
Many aspiring borrowers are often deterred by the fact that their credit score is lower than lenders would accept. Here is some great news. The FHA will insure your loan with a credit score of 580 or higher, and you get to put a down payment of just 3.5 percent.
Do not worry if your score is even lower than that. FHA will give you a mortgage with a score as low as 500 if you can find a lender to approve the loan.
When shopping for your new home, you may find the process challenging, particularly when looking for a mortgage. During this period, some knowledge about mortgages can help make the process much easier.