What mortgage suits you best
Heritus Lead Transfer
Va Home Loans, va mortgage leads
Selecting the right mortgage can be extremely tricky whether you’re a first-time homebuyer or you’re looking to upgrade. Here are a few options that are explained in simple terms to help you decide what mortgage is best for you.
Fixed Rate Mortgage
Like the name suggests, in a fixed rate mortgage the rate of interest is fixed and does not change over a period of time. When you finalize on a mortgage the interest rate is also finalized. After this it does not change regardless of whether the industry interest rate rises or falls. If you plan on living in the same home for a long time and the current rates of interest are low and expected to rise in the future, a fixed rate mortgage makes sense. Fixed rate mortgages give some amount of stability and predictability that a lot of buyers find appealing. However, if you plan on living in this house only for a short period of time a fixed rate mortgage might not be the best for you since you can usually find a mortgage at a lower rate.
Adjustable Rate Mortgage (ARMs)
Completely different from fixed rate mortgages, ARMs have rates of interest that change over time. For a certain initial period of time the rate of interest is low – usually lower than the rate for a fixed rate mortgage. This means the up-front costs for the buyer is reduced. After the end of the initial period, the rate of interest for the loan will shift periodically. An ARM is especially suitable for someone who does not plan on staying in the same home for a long period of time. If the buyer decides to sell the property before the end of the initial period a large amount of money is saved since the interest rates of ARMs are lower. If you intend on living in the house for a long period of time then ARMs can be a slight gamble since after the initial period the interest rate could either fall or rise drastically.
Veterans Affairs (VA) Mortgage
For a fixed and adjustable rate mortgage the down payment is usually high – 20% of the purchase price. Instead of paying a large down payment a buyer can also opt to pay for private mortgage insurance (PMI) in order to ensure that even if the buyer defaults, the bank will get paid. However, VA mortgages are available to qualified members of the military. While a veteran might have to pay a financing fee, he/she will not be required to pay a large down payment since the Department of Veteran Affairs backs them. For veterans who would not like to pay a large down payment or a PMI, VA mortgages are convenient options.
Va Home Loans
, va mortgage leads