Home Loan Workbook

FOUR THINGS FIRST TIME HOME BUYERS SHOULD KNOW ABOUT MORTGAGES

Our mortgage bankers can guarantee that you will learn a lot about mortgages during the home buying process. That’s why USA Mortgage works to make home buying a positive learning experience as well as help you take the next steps into a new home. We have compiled 4 things we feel you should know about mortgages. • Small changes in interest rates can make a big dierence. A lower interest rate (even by less than 1%) could save you 10’s of 1000’s of dollars over the life of your loan. • Adjustable rate mortgages (ARMs) are limited in how much they can adjust per year. You can breathe a sigh of relief knowing that ARMs are not as risky as they may seem. While interest rates may climb over time, your mortgage rate doesn’t have to. ARMs. typically have a cap on how much interests rates can increase each year. • Paying points up front may work to your benefit if you plan to stay in your home for many years. Points are an additional fee you can pay when you close on your home and are expressed as a percentage of your loan. For example, on a $200,000 loan, two points amount to $4,000. If you pay these points up front during the closing, often times it leads to a lower interest rate. If you plan to stay in your home for several years or even decades, this may be a wise purchasing decision. • Start saving for your down payment. Even if you are approved for a program with little or no down payment, you need to start putting money away. You may be required to pay for a termite inspection, home inspection, or occupancy permit out of pocket. Having money put away will help get items taken care of quickly. Whatever is left over after closing can be put to use adding touches that make your new house a home.

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