Types of Mortgages
Fixed: A fixed term mortgage with a fixed interest rate. The interest rate and term are fixed at the start of the mortgage. The monthly amount for the payment of principal and interest will not change over the term of the mortgage.
Adjustable: Often referred to as an ARM (Adjustable Rate Mortgage). The interest rate on your mortgage will be adjusted up or down according to current interest rate levels. The monthly amount for your principal and interest payment will go up or down parallel to these rate fluctuations. These mortgages may include Interest Only type of loans. Recently new product lines have been introduced, most notably by Washington Mutual, called OPTION ARMs, which allow the borrower to determine the amount of the payment each month, often allowing payments less than the interest amount. These are called Negative Amortization Loans. With these loans, payments made for less than the amount of interest due result in the remaining interest amount being added to the loan amount, thus increasing the Principal owed. Borrowers should be very careful with this sort of loan.
See more discussion on this subject on the Understanding Mortgages page.
How much down payment?
One of the first questions home buyers ask regards how much down payment is needed? There is no standard answer. Down payments will vary from 0% down with a VA -- Veteran's Administration loan, or with 80/20 dual mortgages, for example, see the Loan Scenarios at Personal Mortgage Brokers, to more than 25% with certain non-conforming loans. On average, most home buyers make down payments in the 5%-15% range. When you are calculating the amount of money required for a down payment, be sure to account for closing costs, which may total 2-5% of the mortgage value, payable in cash at the time of closing.
What is Pre qualification?
Pre qualification is the first step in securing a mortgage. Lenders analyze your income, your debt, and credit history in order to qualify you for a maximum loan amount. This gives you a clear picture of your financial parameters and a maximum housing price (the mortgage amount plus down payment). With pre approval, the lender verifies your income, debt and financial circumstances, approving the loan subject to an appraisal of the property. See the discussion below on mortgage pre qualification vs mortgage pre approval for more information. For mortgage pre approval or mortgage refinancing Apply Online Today For Low Rate Mortgage Home Financing!
Mortgage Pre Approval vs Pre Qualification
For mortgage refinancing, or applying for a new home purchase mortgage, being pre qualified for a mortgage loan is not the same as getting mortgage pre approval. Mortgage pre approval means that your application is taken by a certified mortgage representative and submitted for approval with either Fannie Mae (DU) or Freddie Mac (LP). This ensures your loan application has a pre-approval and will be saleable on the secondary market. Mortgage home loans need to have Fannie or Freddie approval to be purchased by conventional lenders. This is an advantage over other people offering to buy the home you want: Your Loan Is Already Approved so there is no need for the seller to worry about your ability to obtain a home loan.
Finding a Mortgage
An easy way to compare mortgage sources and offers is to apply online.
Mortgage Glossary and Additional Information
If you want additional information on Mortgage terms and jargon see the Mortgage Glossary for definitions of common Mortgage terminology.
Credit Problems
Options exist for people with credit problems who want to purchase a home. See the section devoted to Credit . | 
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