Fixed mortgage rates have been slowly and steadily rising, according to Freddie Mac, meaning that now may be a good time for you to stop waiting and consider buying a home.
Don’t let the process of getting a mortgage loan overwhelm you—Bank of American Fork’s experienced loan officers in Washington, Utah, Salt Lake and Davis Counties will help you understand the process, guide you through the paperwork and provide a quick turnaround.
To get you started, here are the steps you will need to take:
Organize your finances. Analyze your finances and figure out what you think you can afford for a monthly payment. Aim to keep the mortgage payment and all other related obligations below 40 percent of your monthly income and stay within your budget when considering homes. When you go to your lender bring pay stubs, tax returns, financial statements, other monthly payments or anything else that may help your lender determine more about your financial situation.
Determine loan type. Your loan officer can help you determine the type of mortgage loan that is right for you. There are several popular options—fixed-rate loans have interest rates that stay the same for the life of the loan, adjustable-rate loans have interest rates that move up and down as the economy changes, high-dollar loans that have higher interest rates and loans through special programs are designed for low-income borrowers or borrowers that need to make a lower-than-normal down payment. Talk to your loan officer to find a loan that fits for you.
Get pre-qualified. Your loan officer will pre-qualify you for a certain amount based on your financial position. You should look for homes that do not exceed this amount plus your down payment and closing costs.
Obtain the loan. Once you have made an offer on a home and your offer has been accepted, your loan officer will help you navigate the loan closing process. This is when you will lock in an interest rate, submit your down payment and pay closing costs and other fees. The whole process typically takes 2-3 weeks.
Pay it off. After closing on your loan, you will be responsible for making minimum monthly payments for the life of the loan, ranging up to 30 years. When the loan is paid off, the lien is released from the title to the home.
Buying a new home is something most people do only a few times in a lifetime, so it’s to be expected that a borrower will have many questions. Don’t be afraid to ask them so you feel confident about the exact terms of your loan and all the costs associated with it.
Don’t let historic low rates pass you by. Call a Bank of American Fork mortgage loan officer at 800-815-BANK or visit our mortgage page to download an application.