3 Things You Must Know Before Buying - Mortgages

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Mortgage regulations have changed significantly over the last couple years. Often narrowing options available to many would be home buyers. Even small differences in the way you structure your mortgage can literally cost or save you thousands of dollars and years of expenses.

1. You can and should get pre-approved PRIOR to going looking for a home.
Pre-approval is easy and can give you a much better idea of what you can reasonably afford in today's market. You should consult with your local credit union or banking institution which you have an established history with or work directly with a mortgage professional. Ask friends, family, colleagues for the name of a trusted mortgage professional they've worked with recently and been pleased with. This is the ultimate thank you to them and also a great incentive for them to work extra diligently on your behalf.

2. Know what monthly dollar amount you feel comfortable committing to.
You and your mortgage professional can work out what you're eligible to borrow but this may not be what you are comfortable with paying every month. You need to work on a 1, 3, 5 and even 10 year plan for your outlook as far as employment, social obligations, family needs might be and look at what is considered comfortable with you as far as payments will be and what plans are available to you given your situation.

3. Make sure you understand what prepayment privileges and payment frequency options are available to you.
More frequent payments (weekly, bi-weekly) can literally shave years off your mortgage. Some programs will also set up direct deposit/withdrawals for you. Depending on your finances and comfortability this could potentially add up to an extra payment each year cutting down the principal amount quicker with some programs.

Discuss these topics with your mortgage professional, also ask if they have local & recent experience and the number of transactions they regularly work with. Ask about types and methods of contact, frequency etc. This is going to be someone that will be part of your "team" to assist you in your search and purchase of your property. Make sure you feel absolutely comfortable with them and their methods of operation. Research them and the companies they work for and with. The internet has a wealth of information along with the Division of Banks here in Massachusetts and the Better Business Bureau. You can also check their licences now that mortgage professionals are licenced by the state at the Division of Professional Licencing via the state website www.Mass.gov.


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