Financing
Finding The Loan That’s Best For You
Securing mortgage financing and determining the cost of your mortgage is a pivotal part of buying a home. As Buyer Brokers we will assist you in locating the best interest rate and the lowest total fees for your mortgage transaction. As an informed consumer, you should always compare the mortgage rates, terms and all of the related fees before selecting a mortgage lender.
Careful preparation and the assistance of your Buyer Broker can help save you thousands of dollars over the life of your mortgage.
Your Mortgage – 15, 30, & 40 Year Loans
Are 40-year mortgages a good idea?
Smaller monthly payments are the primary advantage of adding 10 years to the traditional 30-year mortgage, but real estate experts say the shorter-term loan usually is more beneficial for the home buyer. The drawback becomes apparent simply by calculating the cost of additional interest payments,which can total thousands for a few dollars difference in mortgage mortgage payments.
What About Splitting My Mortgage In Two And Paying Bi-weekly?
Some people set on paying off their home loan early and reducing interest charges opt for a biweekly mortgage. Monthly payments are divided in half, payable every two weeks. Because there are 52 weeks in a year, the program results in 26 half-payments,or the equivalent of 13 monthly payments per year instead of 12. Using the biweekly payment system, a homeowner with a$70,000, 30-year biweekly mortgage at10 percent interest could save $60,000 in interest and pay off the balance in less than 21 years.
What About A 15-Year V. 30 Year Loan?
The difference in payments and overall savings between a 15-year fixed-rate loan and a 30-year fixed-rate loan depends on the interest rate and the loan amount. Using a $100,000 loan and 7.25% interest rate as an example,monthly payments on the 15-year note offers the opportunity to save considerable money over the life of the loan, since the period of amortization is half that of the 30-year note. This means that the total interest paid on a15-year note as compared to a 30-year note is significantly less. However, calculating the overall savings of the 15-year note over the 30-year note depends on several individual circumstances, such as the borrower’s changing income status.
Your Mortgage – No Money Down
What About Nothing Down?
Though some real estate experts advise against it, home buyers interested in buying a house with nothing down can do so. But it’s not easy finding these loans and in some cases they can be risky. Occasionally, a builder will offer no-down loans to induce sales in an otherwise slow-moving project. Desperate sellers also may agree to finance the full purchase price to get out from under a property. The Department of Veterans Affairs, or VA, loan program is one program that allows buyers to qualify for a no-down loan.
Is Equity Sharing A Good Idea?
Equity sharing is not as popular in a slowly appreciating real estate market as in a rapidly appreciating one (when equity investors are easy to find). Nevertheless, a form of equity sharing called tenants-in-common partnerships is becoming more popular, particularly in high-priced markets. First-time buyers are the most interested in TIC arrangements because it gives them a way to buy property collectively with an unrelated partner. Loan underwriting standards are more complicated in TIC deals because lenders have more than one party’s financial situation to assess. But many standard loan programs do apply.
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