Tips on Owning a Home: It’s More Than Just the Mortgage!

One of the most common misconceptions about home ownership is that you simply buy a house, pay the mortgage every month, and call it a day. However, the reality of owning a home is that it costs a lot more than just the mortgage!

In this blog post, then, we’re going to go over the full list of expenses that come with owning a home so that you can decide if you’re in the market to buy a home, or to continue renting as you’re currently doing.

  • Insurance: many lenders, especially from the so-called “big banks,” will require you to have homeowner’s insurance before giving you a mortgage. This premium varies from state to state, and different environmental factors — such as your area’s propensity for hurricanes, earthquakes, and flooding — can drive the price up significantly.
  • Property Taxes: again, this is an inevitable cost. Now, there are some mortgages that allow this to be built in — and paid — from the monthly mortgage payment, but in the end, this will also drive your monthly payment up to more than you thought before. Like insurance premiums, property taxes vary from state to state, and are dependent on the value of your home.
  • Utilities: you thought you had the “utilities” thing down pat when you were living in your first studio apartment, but the reality is, the utilities go up tremendously when you’re trying to heat, water, and provide electricity to a home with a few thousand square feet. Make sure you budget accordingly!

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What is an Adjustable Rate Mortgage and What Are the Benefits?

If you’re trying to find a loan, especially to purchase real estate, you’ve probably heard of the adjustable rate mortgage. You may be wondering why it would be good for you, or maybe even what it is. Let’s answer a few of your questions here.

What is an adjustable rate mortgage?

An adjustable rate mortgage is actually almost as simple as it sounds. The bank will give you an initial interest rate for your loan, but as time goes on, this rate will probably change. Of course, it’s not just up to the banks to choose whatever mortgage rate they want. The rate will depend on one of several indexes, so the rate can go up or down. Most of these indexes are similar, so it doesn’t make much difference which one the bank chooses, but you should still find out which one your loan will follow and why the bank chose that one.

The benefits

Using an adjustable rate for your mortgage can be very helpful to you. For example, because the bank considers you to be taking the risk when you accept an adjustable rate loan, it will often give you a lower initial interest rate. An adjustable rate loan is great if you think that interest rates are likely to go down, or even stay about the same, over the course of the loan. It also might be a good choice if you don’t plan to hold onto the property for very long.

Are you considering an adjusted rate mortgage? Contact us. We’re experts and can help you with everything that you need.


The Benefits of an Adjustable Rate Mortgage

Over the past several years, many people have developed some strong opinions against an adjustable rate mortgage. However, there are actually several reasons that this type of mortgage is still relevant in today’s society. Is this the right decision for you? Learn more about this mortgage below in order to find out.

Low Interest Rates

One of the best things about this type of loan is that it allows you to save a great deal of money when it comes to the interest that you begin paying on your home. Typically, your ARM rate will be significantly lower than a fixed rate, which allows you to save money. To help increase the value, consider adding the savings to the principle of your home in order to pay it off faster.

Short-term Loans

Adjustable rate mortgages are especially attractive to those who do not plan to stay in their home for an extended period of time. This could be those who are only at a location temporarily or who are simply looking to upgrade their home not long after purchasing it. Regardless, this type of loan will help them to save money in the short run so that they can move on quickly.

Most people believe that ARM rates will only increase as time progresses. However, the opposite is actually true as well. When the rates are down, your loan payment will also decrease. This allows you to pay more towards the principle of your home and less to the interest.

If you are considering an adjustable rate mortgage, be sure to contact us today.