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i’m planning to buy a home
it’s my first time
the thing is i have no idea or knowledge about home mortage

the cost of the house i want is $ 319,900 and my downpayment would be 20% of the cost of the house
i live in everett, washington and planning to stay at the house about 3-5 years

i need help about what kind of mortage loan (fixed mortgage or ARM or interest only!) and mortage company to choose.

and what “point range” means in mortgage and what does “loan purposes” mean

PS: i want a affordable monthly payment about 1000-1500 a month

4 Thoughts on buying home help?
  1. Reply
    robert w
    October 9, 2012 at 3:19 pm

    sorry u be misinformed.
    250K loan and 1000-1500$ month p&i do not go together on fixed rate.
    if u are staying only 3-5 yrs keep RENTing.
    ur costs will exceed ur return on house.

    get fixed rate only , pay no points, 30 yrs or 15 yrs only NO balloons, NO ARMs , NO pmi coverage loans.
    get and read any of the ‘house buying for dummies’ books
    get read understand ‘total money make over ‘ d.ramsey.

    so we will not get to visit.

  2. Reply
    October 9, 2012 at 4:18 pm

    Well, I’m not a fan of the ARM. Interest only is a great mortgage for certain people, but wrong for most of us. If you know you’ll be making a ton of money in about 3 to 5 years, or you know you’ll be transferred to another place in that time, an IO works. You don’t build much equity during that amount of time anyway, and you may as well be living in a nice home than spending money on a rental apartment with all it’s accompanying problems. It’s perfect for a resident who’ll be a heart surgeon in a few years, or a corporate person who gets transferred every couple of years. But for the average Joe…bad news.

    Arms aren’t that attractive right now to choose one over a fixed rate. I’d go with a fixed rate.

    Loan purpose means purchase or refinance. If you’re buying the house it’s a purchase. Anything else is a refi. Many people think if they don’t have a mortgage now, it’s not a refi. It’s a refi.

    Now points…points are a per centage of the loan amount you pay at closing to lower the rate. Here’s an explanation of points:

    You have to decide if the cost of the points offsets the savings on the payment.

    Here’s a mortgage calculator so you can figure out the payments.

  3. Reply
    October 9, 2012 at 4:42 pm

    All mortgage loans are not created equal. If you are looking for a loan, you have probably discovered the array of loan types and options. It can be confusing forthe first-time borrowerand are easier to qualify for than conventional loans. They are also guaranteed to the lender, which allows the borrower to obtain more favorable loan terms.

  4. Reply
    October 9, 2012 at 4:42 pm

    Personally, at this point, I wouldn’t buy a house unless I was getting a “bargain” and purchasing below market value (it’s just a little cushion just in case the market continues to fall)…especially if you plan to stay for only 3-5 years. Ask yourself if you resell the house in 3-5 years (paying a selling agent about $ 18K-20K, 5-6%), will the property have increased enough to recoup your down payment even after you deduct the selling costs?

    If YES to the above, and you are ONLY staying for 3-5 years, I’d go for the ARM/IO – check the intro rate, and the index and margin on these loans…. You aren’t really building a lot of equity in your payments in the first few years, and if you can get a no cost loan with a 3 year prepay penalty, it fits into your plans…

    Don’t forget about property tax and insurance…sometimes people focus too much on the loan payment amt, and the tax and insurance sneaks up on you…

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