If you have never purchased a home then you need to know right away that it is a process that could leave you pulling your hair out. Knowledge is power when it comes to home buying. Even though you may have the best real estate agent out there, you need to be aware of some factors that could make buying your first home a pleasant experience. And you should keep this information in mind when you are shopping for that new home.
Your mortgage loan is something that you will be paying on for a long period of time. It will probably be one of the most important documents you will ever sign. Before you finalize the purchase of the house, take the time to look over your mortgage loan carefully. You need to pick it apart so that you understand all of the fine print. Just because you got a mortgage rate that is below the current market rates does not mean that will be the rate you keep for the life of your mortgage. You need to know whether or not that rate will rise in the future and how that will affect your payments.
In order to understand this paperwork, enlist the services of a mortgage lawyer and ask them to sit down with you and go over it line by line. They will be able to legally advise you on the contract you want to sign and will help you determine whether or not you will be able to continue affording your mortgage after any type of rate change.
Also keep in mind that your particular needs and circumstances are different from everyone else's. The variable rate mortgage that Aunt Sophie has on her home may not be the best choice for you. Always consider the different plans that are available. If you plan on staying in your home for a long time, usually a fixed rate mortgage is the best option. You will know how much you will pay every month for the life of the mortgage.
Do not assume that you have to pay the closing cost on the home. Most lenders will work with you and the seller to bring any additional costs down, such as asking the seller to pay some of the closing costs on the sale. Always discuss these points with your real estate agent and the mortgage lender before you go to closing. If the seller is not agreeable to helping with the closing costs, you still have time to find a better interest rate on your mortgage that will help keep the costs down.