How To Find the Right Home Loan

Three things you need to do to choose the right mortgage program.

If you can’t afford to purchase your dream house entirely with cash, you’ll need to take out a mortgage loan to help you pay for it. Since this usually involves borrowing a six-digit figure and paying it back over decades, the decision of which home loan to get is critical. If you choose wisely, you could be saving thousands of dollars and building your wealth and equity over the life of the loan—get it wrong, and you’re jeopardizing your financial health.

There are many home loan products to choose from, which makes it easier to get it wrong than get it right. As a borrower, what can you do to ensure it’s the perfect one for you? Here are a few things you need to do to find the right home loan:

1. Review your finances. Start by taking a closer look at your finances and determining how much you can afford. Review your household income, credit score, and existing debts to find out which mortgage product will best fit your needs. Typically, there are two types of loans that you may qualify for: a conventional mortgage and a government-backed mortgage. If you have a fair credit score but little savings, a conventional mortgage may be the right option for you. For borrowers with great credit scores but a low debt-to-income ratio, the government-backed mortgage will be a sensible route to take.

“Choosing the perfect mortgage is only half the battle—the other half is finding the right lender.”

2. Consider how long you’ll live in that home. After choosing between a conventional mortgage and a government-backed mortgage, you now have to consider the type of interest rate your mortgage carries and how long you’ll live in that property. Mortgages commonly either have a fixed rate or an adjustable rate. A fixed rate provides the same interest rate, monthly principal payment, and interest payment throughout the life of the loan. It’s recommended if you’re buying your forever dream home. Meanwhile, an adjustable-rate mortgage has interest rates that may vary over time. It can be a viable choice if you plan on refinancing or selling the house in the next few years.

3. Shop for the best lender for your situation. Choosing the perfect mortgage is only half the battle—the other half is finding the right lender. Make it your mission to hunt for a lender with the best mortgage rate. Think of it as if you’re shopping for a pair of shoes, or whatever item you’d want to buy at the best price. If all of this sounds like too much for you, don’t worry, I’m here to help. I can show you how to save as much money as possible on your home purchase so you can make a successful financial move.

Aside from the ones mentioned, there are other home loans that are less traditional. If you’d like to learn more about them, I’m happy to discuss them with you. Remember that understanding your options will help you find the perfect mortgage product. For any other questions about how you can secure the right mortgage or anything else related, call or email me. I’d love to connect with you!