On The Money

A Smart Purchase: Buying Your First Home in Salt Lake City

MortgageBuying a home is a major undertaking, and it will not do to go into it with your eyes closed. When shopping around for your first home in Salt Lake City, hard on the heels of the type of house you want is the mortgage loan you should have. Here are a few things you need to know about getting a mortgage loan in Salt Lake City, according to AltiusMortgage.com:

Lenders Want Documents

Be ready to give your financial documents to your lender. If you deal with a bank that is willing to prequalify you for a home, then you are one of the lucky ones. But, banks may not be able to give you the same rates as mortgage lenders, so keep that in mind when you crow over your prequalification. To be on the safe side, get a mortgage broker to help you get the documents you need together to get the best rates in town.

Mortgage Type Decisions

Your lender will offer you a choice between a fixed mortgage and an adjustable rate mortgage. Your decision should depend on what you can afford on a monthly basis, how long you want your mortgage to be, and the prevailing interest rates in Salt Lake City. If you think the rates are not going to get much lower, a fixed rate may be your best bet. Ask your mortgage broker for advice before you make a decision.

Closing Costs

Even if you qualify for your dream home, your closing costs can give you a nasty surprise. Before committing to anything, have the lender give you a good faith estimate of what your closing costs will be. It is not set in stone until you close the deal, but it will give you a good idea of what you have to pay the lender out-of-pocket. You can go for a no-cost mortgage to avoid closing costs, but keep in mind that it could bump your interest rate by half a point or so. Some lenders might offer you a no-cost mortgage at the same interest rate as a regular mortgage, but that is rare. Ask your mortgage broker to explain the pros and cons of a no cost mortgage.

Remember that your mortgage will be with you for a long time, especially if you get a 30-year one. Before you make important decisions, weigh the pros and cons carefully, and always consult with your mortgage broker.