Why Buying a First Home Feels Difficult
by Marjorie H.
(Arlington, VA, USA)
Ask Kate why buying a first home feels difficult: Hi Kate, I'm a first time home buyer, excellent credit, 20 percent down- this SHOULD be easy but it doesn't feel very easy!
I've learned a lot on your website already. Thank you! I think this should be such an easy answer.
I am seeking to buy my first home. I just returned from Afghanistan (DOD Civilian) where I saved a lot of money.
I have an excellent credit score, next to no debt, 20 percent to pay down (possibly more if need be) and I want to make the best decision on a mortgage rate. Fixed or variable, what company should I go with and over 15, 20 or 30 years. (Not sure I can afford 15 years though.)
Is this an easy answer I just cannot see? Thanks you SO much for your time!! In case you need to know, I already found the house - great neighborhood, good price and move in ready! Marjorie
Kate Answers: Why Buying A First Home Feels Difficult
Dear Marjorie, I'd like to confide in you (and the other thousand readers) today.
When a Realtor would phone to say they were referring an easy home buyer, their comment would automatically put me on alert.
It's not that I'm a pessimist, just very cautious with other people's affairs. The easiest way for a home buying transaction to go awry is for the team to be lulled into a false sense of security.
So that being said, I also understand why you say buying a first home feels difficult even with your outstanding qualifications. I believe the reason for the hesitancy on your part is the enormous amount of decisions one must make as a first time home buyer.
But let me see if I can offer some insight and reduce the uncertainty. You'll find I link to pertinent pages as we go. Please follow the links for more in-depth information on my website.
Getting The Best Mortgage Rates
I think you answered your own question about the 15 year fixed rate mortgage program. When monthly house payments are not affordable, it doesn't matter if you nabbed the lowest mortgage rate or how soon you'll be scheduled to pay off your house. How much you can afford in a mortgage payment
must be your first consideration. When you follow that link, you'll understand why you CANNOT depend on your mortgage professional for this decision.
Deciding On A Mortgage Program
Here is how I would go about comparing mortgage programs. For starters, I'd look at a 30 year fixed rate mortgage if the monthly house payments are affordable. Why? Two reasons!
1. Current 30 year fixed rates are about the lowest they've been in 50 years. Adjustable mortgage rates are not much lower and fixed rates offer incredible stability.
You can keep up with Freddie Mac's average interest rate report, updated each Thursday, on my website at Compare Mortgage Rates
or on Fridays in my mortgage blog
2. Choosing a 30 year fixed rate mortgage doesn't mean you can't pay it off in less time. I'll show you how to do this at Best Fixed Rate Mortgage Tips
One note though. You must verify in writing that the mortgage terms do NOT include a prepayment penalty.
Play around with different pay-off options by using my mortgage payment calculator
, just like your lender is doing. I'll walk you through the steps of using a home mortgage payment calculator
for early pay-off.
Note: My calculator uses Java technology on your computer and sometimes can be a little slow to initially open, but be patient. It is worth it!
Two First Time Home Buyer Tips
Getting the best mortgage rate, as crucial as it is to payment affordability, is only one piece to the puzzle. It is also necessary to learn how to reduce mortgage closing costs. I can show you how!
Secondly, a quoted interest rate is not the basis for choosing a lender. Let me say this once more. Calling a lender on the phone for a mortgage rate is not the way to choose a lender.
Only the locked in interest rate is dependable. On top of that you must understand the terms of the lock and get them in writing. I have a series dedicated to locking interest rates. Start here and continue throughout the pages.
Finding Help for Locking Rates
My Interest Rate Lock Guarantee - Help for timing your rate lock.
The best solution to avoiding hidden fees is to ask the right questions before you lock mortgage rates.
Get mortgage broker fees in writing or your rate lock is meaningless!
How good is a mortgage interest rate lock guarantee?
Yield Spread Premium is a common reason for losing your rate lock.
Questions to ask before you lock.
Search questions and answers at Ask Kate Mortgage Rate Lock Center I.
More questions and answers at Ask Kate Mortgage Rate Lock Center II.
Comment and Link To This Page
Marjorie, one more thing. Is this page is helpful to you? I'd like to hear back from you. Comment on Why Buying a First Home Feels Difficult
. Or Ask Kate another question
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in your email, website or blog.
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