What is the difference between fixed and adjustable rate mortgages?
Fixed rate mortgages are exactly as they sound. Your interest rate is stable or “fixed” for the life of the loan. You would need to refinance your loan in order to change the interest rate.
Adjustable rate mortgages include at least one change or “adjustment” in your interest rate during the life of your loan. These mortgages are popular when interest rates are high and likely to decrease. Some buyers also use them to control costs in the beginning of their loan.
How much do I need as a down payment for my home?
We allow down payments as low as 3.5% percent of your home. However, there are many benefits to choosing a higher down payment including lower interest rates, lower monthly payments, and a smaller total loan amount.
What is Private Mortgage Insurance?
If your down payment is less than 20%, you will likely be required to purchase private mortgage insurance. This insurance protects the lender in case of default and is what enables buyers to use lower down payments. This insurance is removed from the loan once the mortgage is paid down to 78% of the loan value.
How good does my credit score need to be to buy a home?
The impact of your credit score will vary depending on the value of the home you purchase and your down payment. Typically, the 3 credit bureaus define a low credit risk as 700 or higher. Even if your credit isn’t perfect, you will likely still be able to purchase a home if you meet other criteria.
Is it true that I can write off my home payments?
You will be able to deduct the interest and property taxes that you pay each year on your taxes. In order to determine your personal deductions, we recommend that you consult a tax professional.