4 Tips on How to Save Big on Home Mortgages
Low rate mortgages can be yours — if you take the right steps.
Buying a house is a big step in anyone’s life. A home is where you live, raise a family, and build a life with your loved ones. Though the housing market has seen better days, home rate mortgages are relatively stable. Cheap home loans aren’t necessarily hard to come by.
There are, however, a few steps you must take in order to get the best home loans possible. Here are four pieces of advice for you to follow:
Fix Up Your Credit Score: First and foremost, having a strong credit score is a crucial component of being considered for cheap mortgages. The Home Loan Learning Center maintains that most home mortgage lenders require a credit score of at least 680 (or 620 for federally assisted housing). Be sure to clean up your credit score before applying for any kind of deal.
Prepare For the Down Payment: Although different home loan lenders have different policies, in general, the down payment on a house will be at least 3.5% of the total loan. It’s therefore essential to save up at least that amount if you’re interested in applying for a mortgage.
Also Prepare For Closing Costs: In addition to a solid down payment, you should also have some money saved up for closing costs such as points. Be sure to avoid other major purposes; otherwise you run the risk of falling into debt.
Budget Your Income Wisely: If you do get a home loan, be sure that you can afford it. Specifically, you should only spend about a quarter of your monthly income on the mortgage, at least according to Ellie Mae. Spending more on housing can lead to negative consequences down the road.
For more information about how to get low rate mortgages, feel free to leave a comment or question at the bottom.