Resources

Financing and Mortgages

Now that you know the pros and cons of renting versus owning, you should look at your finances to determine whether buying a home is viable. Just because you decide you want to own doesn't mean you can. You need to have sufficient funds saved up to cover a down payment, closing costs and other expenses.

Preapproval

Start by getting preapproved by a lender. You will need to submit W-2 tax forms, payment stubs, recent bank statements, proof of investments and other financial information to determine your net worth and how much house you can afford. This is a crucial step, not only because it will help set your price range, but because a letter of preapproval is often necessary when submitting an offer. The letter, provided by the lender, shows sellers you are a serious buyer with the financial security to purchase their property.

Credit Score

When getting preapproved, the lender will check your credit score. The number is used to assess the risk involved in giving you a mortgage. This risk affects the interest rate you can get for your mortgage. A borrower with a low credit score has a higher risk and therefore commands a higher interest rate. A high score generally results in a lower rate. Borrowers may also be able to lower their mortgage rate by buying "points" equal to 1% of the loan amount.

The scale used to measure credit is 300 to 850. Since the fallout from sub-prime mortgages, lenders have tightened their qualifications for loans. Now, it is desirable for borrowers to have credit scores of 720.

Mortgages

Fixed-rate loans are very popular today because the rate is locked and will not change later on causing monthly payments to increase (which was a major issue with sub-prime mortgages). Of course, some borrowers choose to do an adjustable-rate loan, which periodically fluctuates from the starting interest rate according to adjustments in certain indices.

Loans have a payment period, generally 15 or 30 years. This is the length of time in which the loan will be paid off. The shorter the life of the loan the more money you stand to save in interest. However, a shorter payment schedule usually means higher monthly payments.

There are many types of home loans available with different qualifications for eligibility. Some are only offered to veterans, others provide assistance to lower-income buyers. It is best to speak with a mortgage professional to learn which alternative is the best for your situation.

Mortgage Costs

Use our handy Mortgage Calculation Tool to see what your monthly payments on a property in Lakeview will be! Just enter the correct data into the fields and Lakeview-Online.com will estimate your mortgage costs for you.

Price:    
Down Payment:    
Taxes: Monthly Princ. + Interest
Assessments: Monthly Tax:
Term: Total Monthly Payment:
Interest Rate: