For most homeowners, the monthly mortgage payments include three separate parts:
Principal: Repayment on the amount borrowed
Interest: Payment to the lender for the amount borrowed
Taxes & Insurance: Monthly payments are normally made into a special escrow account for items like hazard insurance and property taxes. This feature is sometimes optional, in which case the fees will be paid by you directly to the County Tax Assessor and property insurance company.
There is no simple formula to determine the type of mortgage that is best for you. This choice depends on a number of factors, including your current financial picture and how long you intend to keep your house. Access Mortgage Group can help you evaluate your choices and help you make the most appropriate decision.
With a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, typically in relation to an index. While the monthly payments that you make with a fixed-rate mortgage are relatively stable, payments on an ARM loan will likely change. There are advantages and disadvantages to each type of mortgage, and the best way to select a loan product is by talking to us.
Generally speaking, you can purchase a home with a value of two or three times your annual household income. However, the amount that you can borrow will also depend upon your employment history, credit history, current savings and debts, and the amount of down payment you are willing to make. You may also be able to take advantage of special loan programs for first time buyers to purchase a home with a higher value. Give us a call, and we can help you determine exactly how much you can afford.
Annual percentage rate, or APR, is an interest rate reflecting the cost of a mortgage as a yearly rate, allowing borrowers to compare different types of mortgages based on the annual cost for each loan.
The APR includes the interest rate of the loan plus other finance charges such as mortgage insurance, points and credit costs.
FICO scores can determine if a loan application is approved and the interest rate offered.
They are calculated from information contained in your credit file.
They include your payment history, the amount of recent inquiries for credit, the kinds of credit you use (revolving credit, loan types, etc.), how long credit has been used, current balances versus highest previous credit.
Get a copy of your credit report and review it. If you find errors, contact the credit reporting agency that sent you the report and explain the error.
They must research the information and correct it in your file.
You are allowed to state a reason for why you had the credit problem (illness, losing your job, divorce, nature’s devastation, etc), which gets placed into your file to be seen by future inquirers.You should request your credit report in advance of making a loan application to be prepared to discuss any derogatory data.