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Many real estate buyers are cloudy on the distinctions between what constitutes
prequalification, preapproval, and final approval or commitment.
One of the first questions that home buyers ask is "how much down payment are we going to need?" Unfortunately, there is no standard answer. Down payments will vary from 0% (with a VA--Veteran's Administration loan) to upwards of 25% (with certain "non-conforming" loans). As an average, most home buyers make down payments in the 5%-15% range, although your own personal situation may dictate more or less down payment. What a Mortgage Payment Consists of 1) Principal: The repayment of the original amount borrowed on a monthly basis. Comparing Terms Always make a comparison between a 15 year term payment and a 30 year term payment. The difference is often surprisingly smaller than anticipated. The savings over the term of the loan, however, can be substantial. For example, comparing a 15 year term to a 30 year term, $100,000 mortgage at an 8 1/2% fixed rate yields the following results.
To calculate your payment, use our payment calculator What About "Points?" Points are prepaid interest that the lender charges at the time of the mortgage origination (when you close). One point is equal to one percent of the mortgage amount. Since points are interest, you can get a lower mortgage rate by paying more points (which makes sense if you are planning to stay in the house a long time) or pay less points by taking a higher interest rate (if you do not plan to own the house for a long period or are short on the cash needed for closing).
Finding a Mortgage Get Pre-Approved before you look for a home and shop with the power of a cash buyer. Quicken Loans is one of the nation's largest home mortgage lenders and was named "Best of the Web" by Forbes, Money and PC magazines. Quicken Loans offers over 100 loan programs and can tailor a program to fit your exact needs. Their process is quick and easy. You can apply online in minutes. You can even sign your application and track the process of your loan online.
Find out that "The Easiest Way To Get A Home Loan" is with Quicken Loans, a name you trust.
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