Home Mortgage Basics

Is Buying a Home Right for You?

For most people, purchasing a home will require getting a loan and acquiring a mortgage, so before taking the plunge, decide if it’s right for you. A house is probably the biggest investment you’ll ever make. It’s an ongoing commitment of your money and your time—remember your home will need repairs, which you can do yourself or hire out. You’ll also have the extra burden of taxes and insurance. But if you decide a home mortgage fits your financial situation, then owning a house can give you freedom to live where and how you want without the unstable nature of renting.

Deciding on the Right Home

Once you’ve made the decision you can afford a home mortgage, and you have the down payment, it’s time to house hunt. The first consideration, of course, is the cost. Do a budget and decide how much you can afford per month. Don’t forget to allocate money not only for the mortgage, but also for taxes and insurance. If you’re the do-it-yourself type, you can save a lot of money by buying a fixer-upper. Also, sellers are often willing to come down in price to compensate for expected repairs. Sometimes going with a smaller house allows you to upgrade to a nicer home.

Finding the Right Lender

There are many home mortgage lenders—from major banks to smaller private organizations—and you should shop around for the best offer. The government has home loans for qualifying borrowers. Veterans can also get help from the government to purchase a home. Brokerage firms, either online or off, that can help you find the best loan for your particular financial situation. These companies have access to multitudes of lenders, both large and small. Different loan packages and rates are available depending on whether you’re buying your first home, a vacation home, refinancing, or looking for a home equity loan.