What do I need to know about Mortgages?
Erin Gillespie
The best person to answer this question is a qualified Mortgage Lender, but here is some general info. In the home buying process, you need to be pre-qualified by a Mortgage Lender to see what price range you are approved to buy in. This price range takes into account many different aspects of your life, including job stability, credit rating, debt to income ratio, etc. These items will also determine what your interest rate will be. Interest rates change a little bit every day, but right now they are about the lowest I have ever seen them! Just last week they went down by over a quarter point, dipping below 4%. A Mortgage Lender will typically lock in your interest rate for a period of time and will allow for a one time float down during that time. For example, if you lock in a 4.25% rate and rates decrease to 3.9%, you can lock in the lower rate one time during the process.
Included in your monthly bill will be the principle investment (cost of the house), interest, property taxes, and property insurance. The mortgage company will hold the tax and insurance money in a separate escrow account and will pay these annual bills on your behalf.
The best way to calculate how much your monthly mortgage payment would be is to google "free mortgage calculator". The mortgage calculator will allow you to insert the cost of the property (along with other information) and will give you a general idea of what you bill would be. Of course, only the actual lender can give you the exact amount you will owe.