When you buy a home, you are making a long-term investment. Your mortgage will take you anywhere between 15 and 30 years to finish paying. Since this is a long-term investment, you have to make sure you get the best mortgage in Utah that you can.
Here are some tips to help you out:
Paying for points
Mortgage points are an upfront fee that you can pay to lower your interest rate. One point usually costs 1% of the total mortgage and lower for ongoing fixed rates. For example, a $500 000 loan at 4.25% interest may require you to pay a $5 000 fee to reduce the interest rate to 4.125%. It always makes sense to pay for points if you plan to pay the loan over a long time.
However, a stay of fewer than ten years can easily mean your upfront costs will outweigh the savings on interest rate with time so make sure you plan ahead when it comes to your mortgage.
How much will I pay in closing costs?
Mortgage rates will often have closing costs amounting to about 3% of the purchase price of the home. Closing costs include lender fees, underwriting and processing fees, appraisal costs and so forth. Make sure you shop around to get the lowest possible prices. You can do this by asking for loan estimate forms.
Do I qualify for any special programs?
There are special programs such as VA loans or first-time homebuyer loans that make home buying less costly. These particular program loans allow little to no down payments. Some of them also come with protections in case you fall behind with your mortgage. It is important to find out if you qualify for any of them to help you save some money.
Purchasing a home is a huge financial responsibility. A small misstep during the process could lead you to paying for that mistake for years to come. Though it would mean extra work on your part, doing your research well means that you wouldn’t have to worry about paying for expensive mortgages in the future.