Are you buying a home for the first time? Do you think you will pay off half of the principal of a 30-year mortgage in 15 years? Are you wondering why banks want you to pay off interest before principal? If you answered ‘yes’ to any of these questions, you need to understand how amortization works before getting a mortgage. How amortization works The two most important points that you… Continue Reading
Mortgage points is a unique American approach to home financing. A mortgage point is an amount equivalent to 1% of the mortgage loan amount. For example, if you take a loan of $300,000, one point would be $3000. There are two kinds of mortgage points: Origination points and Discount points. Origination Points Origination fee is… Continue Reading
When you apply for a mortgage loan, the lender is required by the federal ‘Truth in Lending Act’ to tell you both the interest rate and the annual percentage rate (APR). This enables borrowers to know the true cost and perform apples to apples comparison of loan offers by competing lenders. Your monthly payment, however,… Continue Reading