Which mortgage program is right for me and why? Every client is different, has different needs, different restrictions, different goals, different financial situations, etc. Therefore, every client needs to be handled differently and a mortgage needs to be obtained that is the right fit for them and their particular financial situation. An example of what might be the right mortgage program for a client that is very conservative, is very confident they will be in their home for a long time, on a fixed income, and needs a mortgage to fit his/her needs, would probably be pretty well suited for a 30 year fixed rate mortgage. Obviously, there are other specifics and much more information needed to make a good decision on what mortgage is right for you but this should provide you with a basic idea or how picking a mortgage program is determined. There are many other determining factors that you can discuss with your Texas Edge mortgage professional.
Just a few of the questions that will help determine what might be the best mortgage for you are: How long am I likely to live in this home? How stable is my income? (both on a month to month basis, but also long term) How much cash do you plan to put down? Are you comfortable with the possibility that your interest rate could adjust in a few years? Do you want the lowest interest rate, or the lowest payment possible
If you are likely to live in your home for 5 or more years, you a fixed interest rate may be your best choice.
If your income is not very stable, you may want to consider an interest only loan. You can pay more than what is due when your income is steady. During times when money is tight, you will only be obligated to make the interest payments on your loan.
If you are not putting any money down, you may not have enough equity to refinance in a few years without out of pocket costs. You may want to consider a fixed rate. You will have the option of refinancing, but you will not be forced to.
Interest rates are relatively low right now. In a few years, they could be considerably higher. If you are not confident that you will be able to afford higher payments or refinance when your fixed interest period ends, a fixed rate mortgage may be your best bet.
You must determine what is more important to you. Interest rate or payment. Different loan programs offer different interest rates. A loan with a higher rate may allow you to have a lower monthly payment.
The more information you give to your loan officer, the better they be able to help you determine what loan program is right for you.
For most real property investors, having positive cashflow is very important. These investors prefer loan programs with minimal monthly payments. Loans with “interest only” features, Adjustable Rate Mortgages with a lower starting rate are ideal for these type of borrowers.
To really know what mortgage is right for you, speak to one our experienced mortgage professionals. They will assess your needs and create a mortgage plan that is right for you.
To determine which mortgage program is right, you must assess how long you plan to live in the property and how much you can afford. An option to consider is the term of how long your loan will be for; 15, 30 or 40 years.
The process of finding which mortgage is best for you is an easy one. First start by listing all the goals you want your new loan to accomplish. Then give that list to your mortgage professional. Have them work up several different programs with several different options. Review each proposal and find which loan accomplishes the most goals. With Texas Edge Mortgage, we make this process easy.
When your listing those goals, you have to be really honest with yourself. If you decided that you are going to live in that house for 30+ years, then maybe you should consider a different mortgage that lets you invest. 90% of first time home buyers do not stay in their home for longer than 5 years. They start families and have to usually upgrade the size of their home.
For more information, contact one of our experienced lending professionals today.Contact A Professional Today