For most people, the mortgage world can be a confusing place but once you understand how it works, you’ll know which one would be best for you. Every mortgage has variables that determine how much a borrower ends up paying. Most people simply want a good deal and not all who want to purchase a home has a 20% down payment socked away in the bank. Mortgage comparisons can be tough and a little knowledge on this can go a long way toward getting the right mortgage at a great price. There are mortgage options available that require less cash upfront and can help you become a homeowner.
The common type of mortgage that most buyers choose is called a fixed-rate mortgage. As the name suggests, the interest rate on a fixed-rate loan stays the same for the entire term. Fixed rate mortgage terms are usually 15 and 30 years. However, you’ll also find 10, 20, 40, and even 50-year fixed-rate mortgages. One benefit of getting a shorter mortgage is that you pay less total interest over the life of the loan than with a longer one. Many people go for longer mortgages as they reduce the monthly payment, which can make buying a home more affordable.
Another type is the Adjustable-Rate Mortgage that might also be referred to as a variable-rate mortgage. With an adjustable mortgage, the interest rate and your monthly payment can go up or down on a predetermined basis. Most Adjustable rate mortgages are actually both fixed and adjustable. They start off with a fixed-rate for a set amount of time and then convert to an adjustable rate. Since adjustable mortgages are more unpredictable and risky than fixed-rate mortgages, they offer a much lower interest rate in the beginning, which can help a buyer qualify for a more expensive home.
Are you ready to take the next steps towards purchasing your new home? Contact the professionals at the Bandy Team for a no-obligation consultation. Whether buying or selling a Denver home, if you’re interested in Denver Real Estate , we can show you some terrific homes for sale in Denver.
Our trusted professionals will be there to help you every step of the way!
Until next time,
Marianne Bandy, Team Leader
The Bandy Team
Keller Williams Park Meadows
720-466-3790
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