They say I need to call my bank and lock in my rate? What is the average, so if they say a number above that I have some sort of leverage.

Thanks.

I’m a first time home buyer (or condo depending).
I’m trying to figure out roughly how much I could get for a mortgage at the various standard options. I make ,000 a year, no dependents, unmarried and have good credit. I have enough money saved for a down payment as well. I really appreciate all of your help! thanks!

I am looking to buy a condo in Los Angeles and I know there are deals for teachers as well as first time buyers. How would I go about utilizing both situations for my advantage? I have a real fear that the home business is full of rats who don’t care about you at all they just want a big return.

I’m interested in buying a house to rent out, but am wondering if it is possible to get a loan that is not dubbed “investment”, which usually requires up to 20% down payment and carry a higher interest rate than regular mortgages.

My fiance and I are looking to purchase our first home in the beginning of 2010. I make roughly 40,000/yr and he makes roughly 60,000. Is a house around 500,000 affordable for us without a large down payment? How much would our monthly mortgage roughly be? Would we get approved with fair credit and without a large down payment (around 20-40K)?

My husband and I were preapproved for a mortgage recently.

If we do not do anything to affect our credit, it it possible to have it un-preapproved from now until we close on our house?

This is both of our first home, so I am unsure of a few things. Thank you.

I am a first time home buyer and I am working with a loan officer. The loan officer has given me two good-faith estimates of closing cost and fees.

All of the sudden there is an application fee of 450.00 which was never disclosed to me before. Should I pay it?

I heard that banks are notorious for adding on fees as the process goes on but is this legitimate?

Should I get a new loan officer if he doesn’t give me all the fees and qoutes up front?

Thanks in advance for all helpful advice!

Hi

My family just bought a new home and the mortgage company keeps sending me mails such as

IMPORTANT NOTICE COMPLETE AND RETURN
mortgage protection insurance plan and life insurance plan.

They make it sound like I must fill these forms out and apply. I feel like they are just extra payments that I have to make. Are they necessary?

Thanks!

I have about ,000 in credit card debt (reduced from ,000 just a year ago). I’m buying a house for the first time, is there some way to get ,000 back from my lender to pay off that debt so I only have the mortgage payment every month? This would knock out the out of control interest rates on the credit cards and save us money in the long term. I’m getting a 15yr note.

Being a First Time Home Buyer can increase the difficulty in the process of obtaining financing, not only due to the lack of credit history but because of the inexperience and lack of knowledge on the field. Following, you will find some tips to help you get started.

The Down Payment Issue

A down payment in the range of 10% to 20% is usually required for obtaining a home loan to buy a house. There are also closing costs that you will need to pay in order to secure the loan.

If you add up these two factors, very few can afford putting down this much money. The financial industry, however, has found a solution to this problem and offers a different financial option.

Zero down mortgage loans are meant for those who cannot put away enough money for a down payment. With these loans you can finance 100% of the property value.

Moreover, for those who cannot even raise the money for closing costs, there are lenders offering 103% or 105% finance home loans.

The extra percentage is used for covering the closing costs which will then be included in the overall debt that you will have to repay in monthly installments.

Drawbacks of Lack of Down Payment

Zero down mortgage loans sound tempting but though not having to put money down in order to purchase a house can seem to be a fabulous waiver, it has many drawbacks and unless strictly necessary, it should be avoided by all means possible.

A down payment has not only direct positive financial consequences but it also can be a positive factor when the lender has to decide whether to approve your loan or not and on what terms.

When the lender has to consider your application, a down payment tells him that if you were able to save enough money to make a considerable down payment, you will probably be able to meet your monthly payments without any difficulty.

A down payment will also imply that you have the ability to obtain finance elsewhere and so, the lender will try to offer you a more tempting loan proposal in order to keep you as a client.

Those who can offer a down payment always get a considerably lower interest rate than those who cannot. As you can see, a down payment reduces dramatically the risk implied for the lender in the financial transaction, and thus, you will be able to get a better deal on your loan.

A down payment will not only reduce the interest rate you pay; it will also lessen all the other loan requirements and will turn the loan terms more flexible. You will be able to get stretchy monthly payments and larger loan lengths too.

Home Equity Loans

If you wanted to use that money for making home improvements or for other expenses, you do not need to worry. Once the deal is closed, the amount you had to put down will become home equity and you will be able to request a home equity loan for the difference between your home value and the amount owed on the mortgage.

These loans are secured and carry low interests; they are the perfect solution if you ever need the money you used for the down payment.

Even though buying your first home may be incredibly exciting, there are some things you should do before considering visiting any mortgage lender.

For many first time home buyers, this will be the largest investment of their life. But there is no disputing the fact that buying a home is a sometimes an emotional process because of the amount of time and paperwork that is normal with any home purchase.

Even if you are just venturing out to look at homes or if you already know what you prefer to buy, purchasing a home requires some research and effort.

Any time that you spend in the preparation is worth the effort because it will help both the lending and closing processes proceed smoothly.

Before you ever contact a mortgage lender, you need to go ahead and get a copy of your credit report. After you get a copy, double-check it for any errors or potential problems.

If you discover an error, you need to contact the creditor to make sure that erroneous items get fixed on your report.

Even if you have a low credit score, it does not mean that you cannot get a home loan, but you may have to pay a higher interest rate.

Organize your Efforts

After you have determined which lender you would like to deal with as well as the mortgage rates you anticipate getting, your lender will request a Verification of Employment form. What you can do is ask your human resources department to keep an eye out for this form.

Then you can rest assured that your very important document is not simply buried in in a stack of mail or on top of a fax machine. If human resources is expecting the document, they are much more likely to complete it quickly.

You will also need a minimum of one month’s worth of pay stubs or payment records from your present employer. Make copies of these and retain the originals.

Find the most recent W2 forms that your employer sent you for the last two calendar years. Your lender requires these wage and tax statements from you as well as from your spouse or other person with whom you are applying for the mortgage.

Find your federal tax returns and make copies of the documents. Use the two most recent years of tax returns if you have not yet filed your return for the the just-past calendar year.

Gather All Necessary Documents

There are more pieces of paperwork that your lender is going to need. Most lenders want at least three months worth of checking or savings account statements.

Also bring copies of any assets like retirement accounts, stocks, bonds, mutual funds and so forth.

Your lender is also going to have to confirm your identity, so that means that a copy of your driver’s license or passport is also needed.

The final thing that you need to do is to make a financial inventory. Calculate how much debt you owe and make a list of each account.

This includes all loans, other real estate purchases and credit cards. Your lender will ask for copies of statements of all of these accounts.

You will also want to determine how much money you will have remaining after you have paid the down payment and the remaining closing costs.

A copy of your social security card is also required. Gathering all of this paperwork really is the difficult part, so being proactive in gathering the necessary documents is of great benefit.

Tips for Choosing the Right Mortgage Lender

A decision that is almost as important as which house to buy is which mortgage lender to use. It is important that the entire transaction is handled efficiently and professionally.

For a first time home buyer, choosing a loan can be a difficult and confusing experience. Sifting through the various home loan options available takes time and doubts usually surface about which choice is the best.

The search for the perfect house loan can be made considerably easier if you follow a few basic guidelines.

Know How Much you Can Afford in your First Home

There is no point in driving around and visiting open houses if you are not certain what you can realistically afford in a new home.

The time would be better spent reviewing your finances, speaking with your accountant or financial advisor and putting some facts down on paper.

With this knowledge you can seek out home loan lenders and request a pre-approved mortgage. Having this confirmation will raise your confidence level and make your actual home search more interesting and satisfying.

Estimate How Long Will you Stay in the Home

The average length of a time for home owners to stay in their home is 7 to 10 years. Attempt to project into the future and determine if your status is likely to change and require you to move.

There could be various reasons for this such as having children, additional space needs, career changes, increased financial stability, and many others.

An additional reason for estimating the duration of your stay is related to the house being an investment. Remember that the home loan and the home value are closely related and that in order to recoup the costs of that investment you will need to remain for some amount of time.

To simply break even could take 3 to 5 years, assuming that the house appreciates 5 percent annually.

Fixed Rate Versus Adjustable Rate

The time that you choose to remain in your new home, or a future home can be helpful in suggesting a fixed rate home loan or one with an adjustable rate be selected.

Staying in a home for only a few years may indicate that a variable rate may be preferred, if economic conditions are favorable.

But, if you seek to remain longer and perhaps raise a family, then the predictability of a fixed rate mortgage may be more appealing.

Be Honest with Yourself

Making that first home purchase is an exciting time in life and causes many questions to arise that must be answered. What are your future plans, where do you want to live, how much can you afford as a first time home buyer, how long will I stay, and many others.

They may seem almost impossible to answer, but by addressing them you will understand more about yourself and what it is you truly seek.

Does buying a less expensive home help lower your mortgage interest rate?

Before refinancing, count the costs. Remember, refinancing will entail paying closing costs.