Finding the Best of Many Mortgage Options

I wanted to take a minute to talk about mortgages, and what they mean to you in the Carson Valley marketplace.

Firstly, I’m often asked if you need a 20% down payment to buy a house. Well, that’s one of the many options you have. The 20% down payment is a way to keep your mortgage payments down, and get rid of mortgage insurance in a conventional loan. Conventional loans also allow you to put 5% or 10% down.

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The old standard of 20% down isn’t
the only option anymore.

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Other options like FHA loans allow 3.5% down, and VA loans allow for 0% down. It’s important to know the options for loans because you’ll also need about 3.5% of the purchase price to cover all the closing costs.

Another question I get is why mortgage interest rates get quoted higher than the advertised rate. Well, the advertised rate is the best possible option. If you have a credit score better than 750 and you’re willing to pay points for a better rate, then those rates may apply. Unfortunately, most people take the advertisement at face value and think that’s the interest rate they’ll get.

Another common questions is about 30-year loans and if they are the best option. It really depends on each individual situation. Some financial situations only allow you to get a 30-year loan. If you do a 15-year loan, the benefit is that you pay less than half of the total interest that you would with a 30-year loan. The downside is a much higher monthly mortgage payment.

There are so many options for loans and how long it will take the pay them off, so it’s really good to have your lender sit down with you and go over all the advantages and disadvantages of each option.

If you have questions or you’d like a referral for a great lender to speak with, I’d be happy to provide you one. If you have any other questions for me about buying or selling a home, give me a ring soon!