Few things in life are as nerve-racking as trying to obtain your first home mortgage. Not only are you in the process of purchasing your first real home, but you are also taking on what is most likely the largest financial obligation of your life. To keep your anxiety level as low as possible, it helps to be well-prepared before you begin the process of shopping for your first time mortgage.
Spend the time to learn about home mortgage loans and the different varieties of mortgage loans. The Internet is a great place to start this process, and you will eventually want to expand your learning to include securing information regarding specific mortgage quotes from lenders. But first, make sure you learn about the basics of home financing: fixed versus adjustable mortgage loans, mortgage loan amortization, home appraisals, and the like. Once you understand the underlying principles of the home mortgage process, you can begin to search more specifically for the type of mortgage loan that best fits your needs.
Be sure to consider an FHA (Federal Housing Administration) loan. These loans can be an excellent choice as a first time mortgage, since you only need to come up with a down payment of 3.5 percent of the home's value. In addition, FHA mortgage loans feature easier qualification criteria and competitive interest rates. Most mortgage lenders offer FHA loans, or you can obtain a list of lenders from the Housing and Urban Development governmental website via their Lender Locator application.
Lender mortgage interest rates can change daily and sometimes even several times during the course of a single day. It can be confusing for many first time mortgage applicants to understand how interest rates behave, but it is important to consider locking in a low interest rate if there is a good likelihood that mortgage interest rates may rise; this protects you from having to pay a higher interest rate on your mortgage loan. Be sure that the interest rate lock period extends far enough into the future to cover your anticipated date of closing.
A final piece of advice for first time mortgage borrowers is to spend the time to shop around to obtain mortgage quotes from a variety of different mortgage lenders. There are thousands of lenders, and each is likely to have a wide variety of mortgage loan options; in this competitive business, comparison mortgage shopping can net you substantial savings.