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Author:
Bev Dodd
Web Site: http://www.family-refinance-consolidation-loans.com
Mortgage loan
rate: The best in rates and lenders
Lenders
are ready to negotiate a better deal for you, on your mortgage
loan rate. Conventional fixed-rate loans offer you a set mortgage
loan rate and payments that do not change. We'll discuss this more
below.
Mortgage loan rate
lenders must compete for your business. This means lenders are
ready to negotiate a better deal for you, if you are a good
candidate to be a homeowner. Do not assume that the mortgage loan
rate that is quoted at first is the final interest rate and be
prepared to ask lenders for a better term. Every little percentage
point that you pay less for your mortgage is going to save you a
lot of money over a 15 to 30 year period.
A conventional
fixed-rate mortgage loan rate offers you a set rate and payments
that do not change throughout the life or "term", of the
loan. A conventional loan is fully paid off over a given number of
years, usually 15, 20 or 30. A portion of each monthly payment
goes towards paying back the money you borrowed, the
"principal", and the rest is "interest". Any
money paid into the value of the house, including your down
payment, is known as "equity" in the home.
A temporary
buy-down on a mortgage loan rate is achieved by lowering the rate
for the first few years, starting out at a lesser amount and
gradually rising to the original loan rate. Of course, because the
mortgage loan rate is lower for the initial few years, so are the
payments. To make up this loss of funds to the lender, the
buy-down usually consists of extra monies paid up front to the
lender when the loan closes. In return, the lender will let the
borrower "qualify", or meet the criteria for the loan,
at the new, reduced rate.
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