Nowadays, owning a home is essential if you want to start a family. And If you are a newlywed and ready to make a home purchase, you need to know a lot of things about the mortgage.
To help you, we have listed four essential things you need to know about mortgages before applying for one. And keep this in mind when looking for Home Loans El Paso TX.
Knowing the Different Types Of Mortgages
In today’s world, there are all types of mortgages sprouting everywhere. With a lot of options to choose from, it can be hard to decide which one to get. To help you, we have listed here all the types of mortgages to make it easier for you.
- Buy-to-let Mortgage (scroll down)
- Capped rate mortgage
- Discount mortgage
- Equity release mortgage
- Fixed mortgage
- Offset mortgage
- Stepped mortgage
- Tracker mortgage
- Variable mortgage
You will find that a lot of mortgages are set up as a ‘repayment.’ It is also called a ‘capital and interest’ mortgage. However, it can be a better choice to opt for an ‘interest only’ mortgage, especially if you can make a regular lump sum repayment. You can do this with your annual bonus.
How Much Can One Borrow?
For so many years, lenders will do a simple multiplication of your salary when it comes to your mortgage. However, that’s all in the past. Now, they have refined their business model a bit.
Nowadays, lenders will only have to look at your monthly expenditure to make sure that you can pay for your mortgage. The amount of money that you can borrow will depend on your current age. It is especially true when you want a mortgage that will go beyond the retirement age.
Each lender often has their criteria that are slightly different from others, so be sure to find the right Home Loans El Paso TX for you. Some rates can be available that will last from two years to the whole term of the mortgage.
If you want to find out how much money you can borrow, there are a lot of calculators online that you can use. Just do a simple Google search.
But be sure to take note that the amount shown on the calculator is merely a rough guide.
So don’t be surprised if it is more or less than what’s shown on the calculator.
How to Improve Your Chances of Getting Approved
Improve your chances of getting approved for a mortgage by having an active and clean credit profile. To help you, here are some of our tips.
- Regularly check your credit report and make sure there are no anomalies.
- Remain on the agreed limit when it comes to your credit cards.
- Pay your loans on time.
- Make sure that you finish your mobile phone contact before stopping the repayments.
- Build your credit profile by getting a credit card and paying it off every month.
- Be sure to inform companies where you have a credit agreement with especially when you want to change your address, including credit cards, mobile phone companies, and utilities.
- Your car lease agreements or loans will affect the amount of mortgage that lenders are willing to consider.