Purchasing a home is a huge step, and for many first time homeowners, it’s one that is extremely daunting. Of course, very few people can buy a home outright, and even those that can usually opt to attain a mortgage on the house. But if you’ve spent your life renting, you might not know exactly what a mortgage is. Even worse, you might be unprepared for entering into your mortgage loan in Maryville. Here’s a basic rundown of what you need to know about mortgages.
When Should You Look for a Mortgage?
If you’re purchasing your first home, you would be forgiven for thinking that you should go out and find the perfect home first, find out how much it costs, then talk to a bank about loaning you enough for that home. While this would be a logical way of getting a loan for most things, with mortgages, it’s actually backward. Talking to different banks to find the best mortgage for you is something you should be doing before you even know what house you will be buying. Doing this will accomplish two things. For one, finding out what your mortgage loan in Maryville allows you regarding the budget will give you a range of prices for homes you should be looking at.
What is the Difference between Prequalified and Pre-approved?
It’s easy to get the two confused, and the distinction is very important. Pre-qualified simply means that you have the potential to get a mortgage loan. It is the first step in the process, but it doesn’t mean much. Pre-approval, on the other hand, requires you to provide some important documents to the lender, and indicates some level of commitment on the lender’s part. Pre-approval is what you need if you want to be considered seriously as a buyer.
These are some of the most basic questions that many first time homebuyers run into, but there are many, many more questions that you might have. Visit a community bank today to learn more about mortgage loans, and make yourself better prepared to make educated decisions about your future.
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