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What Kind of Mortgage Fits Your Needs?

No matter the state of the economy, each year the number of new mortgages underwritten reaches millions of homeowners.  Some are buying for the first time while others are downsizing or upsizing.  When rates drop, like they did over the past 2 years, many people seize the opportunity to refinance their home loan.  However, how do people decide on which mortgage to use for their specific need?  An online survey conducted by HSH.com points to some of the factors that influence consumer decisions.

Most Important Factor

It should come as no shock that the most important factor is the interest rate.  Regardless of the type of loan, the size of the loan or the customers home state, everybody is trying to get the best rate for their home loan.  In the survey mentioned above over 45% stated that the rate was the top factor for choosing a loan.

Other items, such as the length of the term and the fees also ranked high in the survey, but none was as vital as the rate.

Deciding How Much to Use for Down Payment

The ability to make a down payment equal to 10%-20% of the home’s price will give the borrower a range of products to choose from.  A large down payment and a solid credit score will usually allow a borrower to qualify for a conventional loan which has the best interest rates.

For borrowers that have a smaller down payment, their options will be limited to FHA, USDA or VA for qualifying veterans.

Choosing the Right Term

With rates at an all-time low many borrowers are actually paying more attention to the term of the mortgage loan as part of the decision process.  While the traditional fixed rate of a 30 year loan remains quite dominant more and more people are looking at different adjustable rate products.  Those borrowers that have refinanced in the past 2 years have often chosen to go down to a 15 or 10 year term in order to drastically cut down on their total interest pay back while also paying off the home sooner.

Brokers Still the Top Choice

When looking for the right mortgage loan a number of people still prefer to use the services of a mortgage broker over a local bank or credit union.  In the survey mentioned earlier over 30% of respondents claimed that they sought the services of a broker rather than another type of lender.  Since brokers typically have access to multiple lenders they can offer any type of mortgage loan and get the best rate too.

Obviously, none of these factors discussed the two biggest items facing a borrower; are they happy with the home and can they afford the mortgage payment?  Beyond those two items, the guidelines mentioned above should help any new borrower pick a loan that is right for their situation.

Additional Mortgage Info:
Home Mortgage Loans

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Hello - Thank-you already to this community, as I recently fell apon your site, and this will be my first blog post here !

You can see my entire blog through my portal here !

Having been though this mess several times beginning n the late 2007's, it was pretty clear that we were in for the long hall. 

Now, why is it that most agents steer away from "short Sales"? And even still - How come the perception for the consumer is not there.....at least not in my area. 

My first Short Sale closing happened in 2008, with a property in Southbury, one town south of our home base of Woodbury, CT.

At that time, I must admit, I was not too up on what and how this thing was getting done. But knew the concept behind it all.

So as I leap forward to today with confidence to rally the consumer, and rally our fellow Realtor - to take advantage of this opportunity to help those that need it. 

It is truly amazing, how even today, if a consumer walks into a bank or home, for either a loan or to apply for a rental - and they don't meet there criteria - its ends there. 9 times out of 10. Our local bankers doing there job? Or should we look at each and every consumer and look to do what would be best for them. We can! And I do. As a Licensed NMLS Originator & Branch Manager, it is our duty to do so. 

Short Sale attempt day one - I head up to the home, spend a few hours cleaning and get picture and show ready. Look at the comps, and make an attempt to see just how and what Flag-star will require. So with some help from this community already, I have my Flagstar "guns a blazing" & ready to "get er done".