Here in Merrimack, many mortgage lenders can help you in financing your dream home. However, the more lenders and lending choices you have available to you, the more complex the mortgage selection process becomes.
With the help of mortgage products that can vary from one Merrimack mortgage company to another and the pros and cons associated with each mortgage product, you have to be sure to get your mortgage selection right the first time. While mortgage brokers such as NextGen Mortgage can help you with your mortgage selection and approval process as a homeowner, it is a good idea to know how to pick the right mortgage for yourself.
However, many prospective home buyers are taking a mortgage for the first time or aren’t sure what mortgage product is right for them. To help anyone looking for help in choosing their next mortgage, we have put together this helpful article, and we suggest you keep reading.
Carefully Evaluating Key Types Of Mortgages Offered By Merrimack Mortgage Companies
A Merrimack mortgage company may be able to offer you different types of mortgages. However, you should know that the two basic mortgage types are conventional mortgages and FHA backed mortgages.
While the same mortgage company might be able to offer you both FHA and conventional loans, the key difference between these two loans lies in the government backing. The government backs FHA loans, and the government guarantees the lender if the borrower fails to pay back the loan in time.
On the other hand, non-FHA approved conventional loans are offered by private lenders, and the lender doesn’t get a guarantee of reimbursement if the borrower defaults in the case of a conventional loan.
Naturally, since the FHA loans are safer to give from the lender’s perspective, the criteria for getting an FHA loan is also much simpler compared to a conventional loan.
The credit requirements, down payment requirements and other necessary FHA loans criteria, are easier to meet than conventional loans. Therefore it is crucial to carefully evaluate both conventional and FHA loans to see which type of loan best suits your situation.
Your Expected Homeownership Duration
Not everyone is looking for a forever home, and when you are looking to get a mortgage to buy a home, you might not be looking for a loan to buy a permanent residence.
In most cases, homeowners have specific durations for how long they want to live in a home, which can significantly affect their decision when choosing a mortgage. If you plan to permanently reside in the home you plan to buy, then a fixed-rate mortgage with a 30 year payback period might be ideal for you.
However, if you plan on only keeping the home for a specific duration of time before selling it, you can get a variable rate mortgage instead. Keep in mind that variable-rate mortgages can often help you own a temporary home at a lower cost since they often have lower interest rates during the initial years of a mortgage.
This reason is why it is essential to carefully consider how long you would want to live in a home before choosing a mortgage to finance the home.
Consider getting help with your mortgage selection process
You can get a mortgage by going directly to the lender or getting one through a mortgage broker here in the Merrimack. While the mortgage lenders are only looking to sell their product to you, a mortgage broker, on the other hand, offers you mortgage options that best suit your needs.
Since a mortgage broker doesn’t represent any specific lender, they can carefully evaluate your situation and suggest suitable mortgage options. So getting help with your mortgage selection process by going to a company like Nextgen Mortgage is one of the best ways to make sure you get the best Merrimack mortgage rates.