5 Tips for Choosing the Best Mortgage for You

The type of mortgage you choose could save you thousands of dollars over the life of your mortgage. Take your time and make sure you have all the facts before making a final decision.

Download Your Home Loan Toolkit  for a free step-by-step guide with worksheets that help you work through each step in the process listed below and get the best mortgage for your situation.

  1. Define what affordable means to you
    A mortgage lending rule of thumb is that your total monthly home payment should be at or below 28% of your total monthly income before taxes. Lenders may approve you for more or for less depending on your overall financial picture, but how much are you comfortable paying each month for your total home loan? The total home loan cost includes the mortgage principal plus interest, mortgage insurance, property taxes, homeowners insurance, and any HOA or other neighborhood fees.  See pages 3-5 in Your Home Loan Toolkit (YHLT) for more information and worksheets.
  2. Understand your credit score
    Your credit, your credit scores, and how wisely you shop for a loan that best fits your needs have a significant impact on your mortgage interest rate and the fees you pay. To improve your credit and your chances of getting a better mortgage, get current on your payments and stay current. About 35% of your credit scores are based on whether or not you pay your bills on time. About 30% of your credit scores are based on how much debt you owe. That’s why you may want to consider paying down some of your debts. See page 6 in YHLT for more information.
  3. Pick the mortgage type that works best for you
    There are many different types of mortgages with the main differences being loan term, interest rate type, and loan type. Loan term indicates the length of the loan such as 30 years, 15 years or other. Interest rate type generally refers to either fixed-rate or adjustable-rate mortgages. Loan type includes categories such as conventional, FHA, VA, and USDA. Government programs often include low down payment or no down payment options. See page 7 in YHLT for more information.
  4. Understanding the difference between points and interest rate
    Points are a percentage of a loan amount. For example, when a loan officer talks about one point on a $100,000 loan, the loan officer is talking about one percent of the loan, which equals $1,000. Lenders offer different interest rates on loans with different points. There are three main choices you can make about points. You can decide you don’t want to pay or receive points at all. This is called a zero point loan. You can pay points at closing to receive a lower interest rate. Or you can choose to have points paid to you (also called lender credits) and use them to cover some of your closing costs. See page 9 in YHLT for more information.
  5. Choose your mortgage and avoid pitfalls
    Once you’ve done your homework and figured out how much total loan cost you can afford each month, reviewed your credit score and decided on the type of loan you want, it’s time to shop for a mortgage. This important step could save you thousands of dollars over the life of your mortgage. Take your time and make sure you have all the facts before signing any documents.

    • Make a list of several lenders you will start with
    • Get the facts from the lenders on your list
    • Compare Total Loan Costs

See pages 10-15 in YHLT for worksheets and more information on choosing the best mortgage for you as well as avoiding common pitfalls and handling any problems that should arise.

The post 5 Tips for Choosing the Best Mortgage for You appeared first on McKee Homes Blog.


Keep up to date On Instagram

PREVIOUS
NEXT
💜 Triangle Walk to End ALZ DAY! Team McKee! 
#McKeeHomesNC
The Triangle Walk to End Alzheimer's is THIS WEEKEND, and there is still time to register and donate to this amazing cause!

Join Team McKee this Saturday, October 9th to help the Alzheimer's Association achieve its vision of a world without Alzheimer's 💜

Visit the link in our bio for more information on this weekends walk!
Thank you to everyone that joined Team McKee and the Alzheimer’s Association at the Corporate Kickoff for the Fayetteville Walk! 

Don’t forget to register and donate to the Fayetteville Walk on Saturday, October 30th! Visit the link in our bio for more info 💜
McKee Homes is excited to announce that we have TWO beautiful homes featured in this year's Triangle Parade of Homes! 

The Parade starts TOMORROW! Join us during the next three weekends from 12PM-5PM🏡

Jordan A Floorplan 
▪Johns Pointe Community - Raleigh, NC
▪3729 Putnam Road

Pullen Floorplan 
▪Townes at Gateway Commons Community - Wake Forest, NC
▪509 Gateway Townes Blvd. 

Check out the third image for more information! This event is free and open to the public, and we can't wait to see YOU there!
She said YES to the address! 🏠

Join us in welcoming Fairfield Farms newest homeowner! With another #LifeChangingMoment in the books, we hope your beautiful new home brings you years of memories. 

What's stopping you from building your own #LifeChangingMoment with McKee Homes? Visit the link in our bio to check our our dream home opportunities throughout the Raleigh, Wilmington, Fayetteville, and Pinehurst areas!
THANK YOU to everyone who joined Team McKee and The Alzheimer’s Association yesterday at the Moore County Walk to End Alzheimer’s! 💜

Together, we are working towards a world without Alzheimer’s. 

If you missed out on this special event, there’s still time to donate and register for our other three regional walks! Visit the link in our bio for more information 💜
McKee Homes Triangle Walk to End Alzheimer’s Kick Off Party yesterday at our Summerwind Community was a SUCCESS! 

Sending a big thank you to the Cleveland Fire Dept, McKee Homeowners, trade partners, and the Summerwind Homeowners Association for making this amazing event happen! 

If you haven’t registered for one of our four regional Walk to End Alzheimer’s, there’s still time! Visit the link in our bio for more information.
Join us THIS WEEKEND for the grand opening of our newest coastal community, Colbert Place! 

Enjoy sweet treats and exclusive tours of this beautiful new community in Leland, where you can enjoy historic downtown shops, the popular Riverwalk, your favorite seafood restaurants as well as some of the best beaches in North Carolina.

This event is free and open to the public, we can't wait to see you there! For more event information, visit the link in our bio!
McKee Homes is excited to announce that we have TWO beautiful homes featured in this year's Triangle Parade of Homes! 

Jordan A Floorplan 
▪Johns Pointe Community - Raleigh, NC
▪3729 Putnam Road

Pullen Floorplan 
▪Townes at Gateway Commons Community - Wake Forest, NC
▪509 Gateway Townes Blvd. 

Swipe 👉 for more information! This event is free and open to the public, and we can't wait to see YOU there!
Attention Wilmington-area homebuyers and realtors! We are inviting YOU to join us for our newest coastal community, Colbert Place, GRAND OPENING event!

Join us on September 18-20th for exclusive home tours and sweet treats, we'll see you there!

Visit the link in our bio for more information on Colbert Place's homesites, floorplans, location & more.