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Mortgage Tips For Newlyweds

Jan 22, 2008
Be perceptive of interest rates! You should get the lowest rate you can find (this should be obvious). Also, make certain you get a fixed interest rate. Variable rates are dicey because they can escalate after the opening rate closes.

Be attentive of what you can pay for. There is no need to hurt yourself money-wise right off the bat. Keep in mind that you don't want your mortgage to exceed 20% of your income after taxes.

If you are a military veteran your state could have a loan program that offers lower rates. Besides being eligible for a VA loan, which doesn't call for a down payment, veteran mortgage programs usually offer lower interest rates than traditional mortgage companies. The best approach is to see if your state has a veteran's mortgage program.

Also, it would probably behoove you and your spouse to rent at first. A lot can change during the early years of marriage while the two of you are figuring out where you want to live and what you want. A big advantage of waiting is it allows you to save money which you can use on a down payment.

Incorporating a down payment when acquiring a mortgage can remove that pesky home owner's insurance expense. Home owner's insurance (not to be confused with home insurance) is a fee the banks charge when a borrower cannot afford a down payment. The monthly home owner's insurance payment is tied in with the monthly mortgage payment (note they are separate entities) and usually is stretched over ten years. This separate capital protects the bank in case the house ever gets foreclosed.

Yet another advantage to waiting is it gives you time to boost your credit score, which will get you a better rate. To boost your credit score, get one credit card for each of you with a low limit and low interest rate, and make a payment on it every month on time. These timely payments will be reported to the credit bureaus and will cast you in a good light with them.

Another important thing to consider is getting a 15 year mortgage instead of a 30 year mortgage. Then, make bi-weekly payments instead of monthly. Doing this will make 13 payments per year instead of 12, and you will pay off that 15 year mortgage in about 11 years! You will also be building valuable equity in your home.

Most mortgage companies will be pleased to assist you in setting up a draft In fact, most will automatically draw the payments from your checking account every two weeks (I have mine set for every payday which happens to be every two weeks). This is nice because you need not fret about writing a check and worrying if your payment will make it on time. Just make sure the funds are in the account!

Acquiring a house and a mortgage can seem nerve-racking for first timers, but being patient and having a game plan will serve you well. Remember to be patient when purchasing a home. There is a lot to deliberate and hurrying into things will not serve you well.
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