Home Buying

Even today, people are still turning to loans to finance their housing mortgage needs. These mortgage loans can be easily accessible in the housing lending market. But, borrowers need to be cautious of interest rates being offered to them by various lenders.

How To Secure The Best Interest Rates

This will determine the difference between the initial amount you get to borrow, and the overall repayment that you will have to make. The following are some important tips to help you secure the best interest rates on loans:

Offer a Security

Although you can still qualify for some loans without offering security, it is advisable to apply for secured loans if you own some valuable assets. This will be enough to convince the lender you are dealing with that you really intend to honor your debt. This reassures them because the asset you pledge can be seized if you default the loan. This gives them more confidence in giving you access to the funds you need to purchase a home. Offering the lender a security can raise your chances of obtaining a home loan with a lower interest rate than if you applied without a security.

Have a High Credit Score

Credit scores are calculated by the separate credit reporting bureaus. Each bureau has its own way of measuring credit worthiness based on their own criteria. These scores are based on a person’s credit history. A high score is an indication that the consumer has a history of paying debts on time. It can also reflect the fact that these debts are paid down quickly as the debtor continues to make payments above the minimum payments due.

High credit scores tell lenders that the applicant can be trusted to pay mortgages on time. It also tells them that the borrower can be trusted to pay property taxes, homeowners insurance and other housing expenses on time. In order to maintain this high score, mortgage borrowers must continue make on time mortgage and other debt payments according to the agreed upon payment schedules.

Carry Out Quotes Comparison

By taking time your time and doing extensive research when searching for lenders, you will find a number of them offering various  types of loans. Different loan packages will offer different interest rates. It would be wise to compare quotes from various lenders, being sure to calculate points and closing costs, as well. By following these tips, you should be in a position to get into the best deal for the type of loan that you are applying for.

This will greatly help in lowering your cost of borrowing, which determines your monthly mortgage payments (PMI). Remember, it’s not as important to get financed for a home as it is to stay in your home. The only way to be able to stay in your home is to ensure that your interest rates are low enough for you to afford your monthly payments.

About the Author: Paula Henry of Sycamore Group Associates provides Fishers real estate services and providing information about Fishers Indiana Homes for Sale to those people searching Fishers Neighborhoods to buy or sell their home.

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Geraldine Ferraro once said: “If you take advantage of everything that America has to offer, there is nothing you cannot accomplish”. This is a powerful statement that should be an American motto.

There are so many advantages in the US that many other countries don’t offer. One of them is the right of homeownership. As we know, this American Dream is achievable, as long as you have the right attitude and the proper tools. Homeownership is definitely something we can all accomplish.

Homeownership is an Investment

Buying a home can be a great investment, especially if you plan on living in or keeping the home for at least five years. This is because most of your monthly payments for the first five years gets absorbed by interest. That means that you are not really building any equity within that time. After about five years, your payments will start reducing the principal debt.

It is believed that the majority of us are not great at saving money on a monthly basis. Dr. Eli Beracha of East Carolina University, who co-authored a paper with Ken H. Johnson of Florida International University, said that, “buying a home is better than renting one, because the mortgage becomes a forced savings account.” He also added that, “people renting should invest in their savings.”

The research found that most of the people who do save money, do not invest it. And, those who invest in mortgages, don’t save money. Basically, he believes that paying a monthly mortgage is a way of saving money. You are building up equity, which can be turned into cash someday, if needed.

Making an Offer

Once you find that perfect home, you will need to make an offer. The offer tells the seller that you are interested in purchasing the home, and let’s them know how much you would like to pay for it. When making an offer, you should consider the following:

• The price should be in line with comparable prices.
• The condition of the home. Will it cost you a substantial amount of money to make it livable?
• How long has the home been on the market? If it’s been a while, the seller may be eager to sell at a lower price.
• Make sure your offer is an affordable one. No matter how much you like the house, you need to ensure that you can afford the monthly payments.

The price you are offering should meet the comparable prices of the area. Comparables are houses sold recently in the same neighborhood with the same square footage and similar floor plans. Offers do get rejected. The seller is more likely to accept a fair market value offer. Your real estate agent will be able to give you comparable information and help you negotiate the offer.

Trustworthy and educated sources of information such as: Forbes Magazine (The Next Mortgage Crisis); Wall Street Journal (It’s time to buy that house); MarketWatch.com (Now might be the best time ever to buy a home) and JP Morgan Market Insights (Housing: a time to buy) suggest that there has never been a better time to buy a home. To invest in a home now will be a wise decision. The current housing market offers homes at the record-low prices, along with the lowest interest rates we’ve seen in decades.

This guest post was provided by Real Estate Merritt Island FL specialist Linda Hare of Tropical Realty, a real estate brokerage helping home buyers purchase Melbourne Florida real estate and some of the most fantastic Merritt Island homes for sale.

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