Are you planning on moving from an apartment to a house? Unless you have saved a lot of money, you will need a loan to finance the purchase.
Buying a home is possible within two or three times of your yearly household income, but this does not mean you get a loan outright. Creditors consider several factors such as credit and employment history, current debts and savings, and the down payment you plan on making. You also have to at least grasp the basics of adjusted rate mortgages, or ARMs to get the best value for money loan.
Understanding Adjusted Rate Mortgages
Home buyers often have to choose between a fixed or adjustable rate mortgages. Both have their pros and cons, but for those who do not have enough cash flow, an ARM, or an adjusted rate mortgage, is an ideal option.
An ARM has an interest rate that periodically adjusts after a period of 5, 7 or 10 years – or even monthly – depending on the terms of your creditor. The interest you pay on the outstanding balance varies based on a certain benchmark. Other names of this type of loan are variable-rate or floating-rate mortgage. Some banks or creditors provide longer terms or a cap on how high interest goes.
The advantages of getting an ARM include:
Lower initial interest rate
- An interest rate cap
- Offers flexibility depending on future income or refinancing within the next few years
- Before you get a mortgage, it helps that you have an adviser guiding you every step of the way to fulfil your dream of becoming a homeowner.
Altius Mortgage Group Can Help You
We at Altius Mortgage Group pledge to help you buy your home, whether it is the first time or if you plan on refinancing. The company offers some of the lowest rates and extensive communication throughout the process of applying and obtaining a loan.
Altius Mortgage Group can pre-qualify you in less than 10 minutes, help you look for the best rate, or close a loan in as short as 30 days.
Contact us to learn more we can do for you.