| It does not matter if you are looking to purchase your | | | | Because this is the case, you really need to focus on |
| first home, or are looking to upgrade to a bigger, better | | | | getting the best possible loan terms with the lowest |
| home; right now is a buyer's market. Because there | | | | interest rate. The lower the interest rate, the less it is |
| are so many homes on the market right now you | | | | costing you to borrow this money, and the sooner you |
| have a huge variety to choose from, and because of | | | | will actually be paying off the principal of the loan. You |
| the huge selection, that starter or dream home is selling | | | | also need to be aware of the different types of loans. |
| for a very reasonable price. Also, if you are a first time | | | | A fixed rate mortgage means that the interest rate |
| home-buyer, you often qualify for special incentives | | | | you are charged is guaranteed to stay the same. One |
| and tax breaks that make owning your first home | | | | example; you get a fixed rate, thirty year mortgage at |
| much more attractive than renting. | | | | the rate of five percent in 2009. You pay five percent |
| Now even with the incentives, unless you can pay for | | | | interest on that mortgage no matter what the |
| this new home in full with cash at the time of the sale, | | | | economy does until 2039. |
| a home mortgage will be required. Typically twenty | | | | Another type that is not as favorable is the adjustable |
| percent of the purchase price is required at the time of | | | | mortgage. As the name implies, the rates adjust to the |
| the sale, and the rest is borrowed from some type of | | | | national average every year or two. So if national |
| lending institution. This is why it is so important to act | | | | interest rates rise, your home mortgage interest rate |
| now if you have been thinking of buying; some of the | | | | will increase. If your interest rate increases, so will your |
| first time home-buyer incentives can significantly lower | | | | monthly payment because it reflects the entire loan |
| the down payment required. | | | | and the interest terms that came with it. |
| Most likely the largest amount of money you will ever | | | | Right now, with interest rates lower than they have |
| borrow will be your home mortgage. If you are looking | | | | been in years, is an unbeatable opportunity to get a |
| to purchase a ninety to one hundred thousand dollar | | | | low, fixed rate home mortgage. Purchasing your new |
| home, you will probably be looking at getting a | | | | home now, with the prices, interest, and the market |
| mortgage note around seventy or eighty thousand or | | | | being where they are, presents an opportunity you just |
| more. You will make monthly payments to the lender | | | | can't pass up. Not to mention the peace of mind you |
| that will be a combination of principal and interest. In the | | | | get knowing exactly what your interest rate and |
| beginning, most of the monthly payment will actually be | | | | monthly payment will be for the entire term of your |
| going towards the interest accumulated on the loan, | | | | loan. |
| thereby not actually reducing the principal amount. | | | | |