A mortgage is a financial instrument designed to help you purchase a property. A mortgage has a few terms to be aware of; interest rate, term, and down payment.
Interest Rate – This is the percentage that the bank charges you to borrow their money. These rates change daily and it’s important to get this as low as possible!
Term – This is how long the mortgage will last and dictates how the payments are spread out. Example: a 30 year loan has lower payments, but lasts 30 years / while a 15 year term has higher payments but is paid off sooner.
Down Payment – This is the amount of money a buyer would “put down” on a property to secure the financing. Many people believe that banks require 20% down payment to buy a home, BUT THAT’S NOT TRUE! There are many lenders that offer as little as 3% down payments (for a $300k home, that’s $9,000!). And in some cases, a home may qualify for 0% down payment!
If you have any more questions about these terms, please feel free to contact DASH to find out more information and begin your house hunting journey!