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Cedar City Real Estate Mortgage Choices

Nearly all home buyers need to secure a mortgage when purchasing a home. There are varieties to investigate. Some can assist you with closing costs and 100% loans can also be applied for. all can be discussed with your lender of choice to make the best decision for you.

While there are countless variations, most common mortgages can be categorized as either fixed or variable. Fixed mortgages offer the same interest rate and monthly payment over the life of the loan, while variable mortgages offer adjustable rates or payments. ARMs (Adjustable Rate Mortgages), the most popular variable mortgage option, offer a lower-than-market interest rate to provide buyers financial flexibility initially during the mortgage, with the tradeoff being the potential for higher interest rates and monthly payments later on.

Nearly all home buyers need to secure a mortgage when purchasing a home. Today, there are a wide variety of mortgage options available. Taking the time to discover the best mortgage product for your needs can offer great rewards in the long run.

While there are countless variations, most common mortgages can be categorized as either fixed or variable. Fixed mortgages offer the same interest rate and monthly payment over the life of the loan, while variable mortgages offer adjustable rates or payments. ARMs (Adjustable Rate Mortgages), the most popular variable mortgage option, offer a lower-than-market interest rate to provide buyers financial flexibility initially during the mortgage, with the trade off being the potential for higher interest rates and monthly payments later on.

Paying points down to lower your mortgage payment

For buyers who are interested in getting the lowest monthly payment possible, paying points on your mortgage is one option to consider. The term “point” refers to 1 percent of the total mortgage loan amount. Most banks and lenders will allow buyers to lower their interest rate a particular amount for each additional point they pay at closing.
If you have the available money and plan on staying in the home for more than a few years, paying points can be a financially rewarding option. Like interest, the money paid in points at closing may be tax-deductible. Most importantly, paying points offers some breathing room with your monthly expenses.

If you are interested in learning more about mortgages, I would be glad to provide you with additional information.

P. M. I.

Potential buyers who wish to purchase a home but can’t afford a large down payment, may want to look into private mortgage insurance. Private mortgage insurance, or PMI, is designed to protect the lender against default while allowing buyers to obtain a loan while putting down significantly less than the standard 20 percent.

The borrower pays a premium for PMI coverage, the amount of which is determined by the type, amount and length of the loan. The premium is usually either worked into the monthly mortgage payment or paid as a lump sum at closing.

Please feel free to contact me if you are interested in learning more about mortgage products or any other real estate information.

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