Purchasing a home is one of the most important decisions for most people, yet not many take the time to learn all the rules of the process. Before getting a mortgage in Fresno, you should do your research and make sure you understand every aspect of it. Here are the five important mortgage facts to get you started.
1. The Fees Matter
You should keep in mind that the quoted mortgage rate is never the final sum you should budget for. On top of the interest rate, you will be charged various fees, such as origination and closing costs, as well as mortgage points. Only after all these are taken into consideration, you can get an idea of the actual amount you will be paying. When comparing lenders, it is best to look at the annual percentage rate, as it usually takes into account all of these costs.
2. The Rates Change Often
Similarly to stocks, bonds, and other investment types, mortgage rates fluctuate frequently depending on the state of the market. The rate can change within hours, which is why if you find something that works for you, it is better to lock that rate immediately.
3. Rates Vary Depending on Lenders
While the government regulates a lot of aspects of the mortgages, lenders are still free to offer different rates to buyers. Their fees vary greatly as well, including the credit check fee, appraisal, and title insurance. For this reason, it is always better to shop around and compare multiple lenders before making your final choice. Keep in mind that finding the lowest possible rate can mean a lot of savings over the years.
4. Refinancing Is Worth Looking Into
Even if you lost money on your home during the financial crisis, you can still refinance your mortgage and get a better rate on it. You can do so by taking advantage of one of several government based refinance programs that were created specifically for lenders like you.
5. Low Down Payments Are Available
While putting a 20% down payment on your home is a good idea, giving you equity in your house right away, not many people can afford it these days. Various federal programs are available though, using which buyers can put a down payment as low as 3.5% and still get their mortgage in Fresno approved.