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The Truth About Observatory Park Mortgages

August 3, 2016

Preparing to buy an Observatory Park home? Many homebuyers rely on lenders to make their dream home become a reality, but the truth is, not many homebuyers know a lot about mortgages. Before you hit the real estate market to search for your new home, learn the facts about mortgages:

It’s important to shop around.
Some Observatory Park buyers make the mistake of choosing a lender right away instead of taking the time to shop around for the best deal. If you already have a checking or savings account open with a lender, that doesn’t mean you should automatically get a mortgage from them. But, if you do have a strong relationship with that lender, that could help you out in your negotiations. Plan on visiting at least three different lenders in the area to see what kind of deal they offer you before making your final decision.

There are always additional fees.
When seeking a mortgage to purchase a home in Observatory Park, don’t expect to just pay back the principal plus interest. Every mortgage will have some sort of additional fees tacked on, but the good news is that many of them are negotiable. Talk to each lender that you visit about how they can make the deal sweeter by reducing fees such as the loan origination fee, application fee, broker fee and underwriting fee. Most lenders have room to negotiate with these fees, so it doesn’t hurt to ask.

Speak to a lender first.

Many first time Observatory Park homebuyers mistakenly think that they should find their dream home first and then figure out the financing with a lender. However, the opposite is actually true. Before you even take a peek at the Observatory Park market, meet with lenders to get prequalified or preapproved for a mortgage. This requires that you give the lender your income information as well as insight into your current debt situation. After looking over a credit report and a few other items, the lender will be able to tell you about how much they’re willing to loan you. Use this number as a guide for determining what kind of Observatory Park homes you should be visiting.

You don’t have to have a large down payment.
Every lender has a minimum down payment that is required in order to receive funds, however they’re typically not too high. Depending on the type of mortgage you’re aiming to get for your Observatory Park home, you could be putting as little as 3.5% down! However, that doesn’t mean that you should always put the minimum. If you can afford to, try to pay more than just the minimum so you can avoid other fees. For example, some lenders will lower your interest rate with higher down payments and also charge you an additional fee if you put less than 20% down on a home. Learn more about down payments here.  

Ready to search for the Observatory Park home of your dreams? Contact Elevation Realty to be connected to a team of experienced real estate experts ready to help you on your home buying journey.