However, if you’re going to buy a home and your down payment is less than 20%, you will need private mortgage insurance. However, in general, the cost of private mortgage insurance, or PMI, is about 0.5 to 1.5% of the loan amount per year. This annual premium is broken into monthly installments added to your monthly mortgage payment. So a $300,000 loan would cost around $1,500 to $4,500 annually — or $125 to $375 per month. To find the best mortgage professional to guide you through buying a home, seek advice from real estate agents, colleagues, or friends. Banks are generally known for having the fewest mortgage options because their products are tailor-made to suit the bank’s interests. However, they can also be more flexible, as they lend the money. If the buyer owns other substantial assets, making a deal with a bank will not be a complicated process. Mortgage brokers are known to offer the most significant amount of options. Working independently and with several financial outlets, brokers can find the best loan for the buyer from different lenders. Now that you’ve identified the house you want to buy and have a professional mortgage advisor, how do you get the best mortgage deal? The first step is to compare different interest rates. It’s easy to get quotes from companies since most offer these services online. However, as the buyer, you should be careful not just to compare interest rates. The best option is to compare the interest rates and all the fees, including origination fees, points, and any other fees the lender might include in the deal. Any loan regarded as a no-fee loan means that all the fees have been included in the rates, and as the buyer, you should note that.
67
Powered by FlippingBook