Tips for Obtaining Your First Dallas Mortgage

Purchasing your first home is a very exciting time. No matter where you wish to live in Dallas, Texas, mortgage rates are very favorable for homebuyers now. With all the excitement and promising conditions, though, a certain amount of research is prudent to ensure you find the best loan package. Before you make an offer on a home, approach lenders directly or partner with a Dallas mortgage broker, it is important to understand the components of a home loan.

Understand the terminology

No matter what lender you approach for a Dallas mortgage, there are fundamentals of home loans every buyer must understand beforehand. Knowing what to look for as well as basic mortgage terminology will allow you to compare home loans wisely and choose your Dallas mortgage with confidence.

The following list outlines basic mortgage principles you’ll need to know before approaching a lending institution or Dallas mortgage broker.

. Principle - The amount of money actually borrowed from a lender for your Dallas mortgage package. This typically equals the amount offered to the seller for the house, but can be more if part of your loan is to be used to cover closing costs.

. Mortgage rate - This refers to the amount of interest paid to the lender of your Dallas mortgage over the life of the loan. This rate is calculated as a percentage of your loan’s principle. If you take out a home loan in the amount of $200,000, for example, and your Dallas mortgage rate is 5%, over the life of the loan, you each monthly installment will include an interest payment equal to 5% of the principle’s payment.

. Loan term - This is the length of time in which the loan must be paid in full. The general rule of thumb is that the less time it takes to repay a loan, the lower the mortgage rate you will be charged. The drawback is that loans with shorter terms also have higher monthly payments. Depending upon your monthly income and debt burden, one loan term may clearly be the better choice in both the short and long term. Your Dallas mortgage broker or lender can help you decide which term is best for you.

. Closing costs - A collection of fees and payments for services required to meet Dallas mortgage requirements. Typically, these costs are outlined in your lender’s Good Faith Estimate. Fees that may be appear in closing costs include title search and insurance, legal, appraisal, credit report and application fees.

Anne is studying to be a real estate agent and a Dallas mortgage broker. Currently, she is taking classes and learning all there is to know about a Dallas mortgage lender and Dallas home loans.

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