15 Important Tips For First-Time Home Buyers

After coming up with a rough budget, you’ll need to consider mortgage options. Two common types of mortgages are fixed-rate mortgages and variable-rate options. You can also purchase a home with an adjustable-rate mortgage (ARM), but this is more specialized and requires additional thinking and calculation. Simply put, adjustable-rate mortgages combine the steady payment figure of a fixed rate for the first few years, and then allow for fluid rate changes to take effect over the long term.

Most mortgages are 30-year fixed-rate mortgages, making this by far the most common choice for new homebuyers. Fixed-rate mortgages offer structured stability over the life of the loan. You will continuously pay the same rate and as a result, the same monthly cost for as long as the loan remains structured this way. On the other hand, a variable-rate mortgage fluctuates with the federal interest rate and can be a major benefit when rates are in a general state of decline.

Selecting the right mortgage for you is all about your research into the market and analysis of where it might be headed over the coming years. As a result, it’s important to take the time to think about what suits your needs and lifestyle best. The purchase of a home is an investment in your future, and as with any investment, it’s crucial to learn as much as you can about the marketplace and its inner workings.