Applying for any type of loan can be stressful, and a mortgage is by far one of the hardest loans to get. Mortgage lending standards are strict, and if you don't meet a list of qualifications, you can't purchase a home. The more you know about getting a loan, the easier it'll be to complete a purchase. GOBankingRates offers a variety of tools and tips to help you find the right mortgage loan.
It's normal to have questions about mortgage loans, especially if you’re a first-time homebuyer. Frequently asked questions include:
1. What are the qualifications for a mortgage loan?
Mortgage loan qualifications vary depending on the type of mortgage you're getting and the bank. You can never go wrong with a credit score of 700 and higher. Also, the less debt you owe, the better. Many banks also require at least two years of steady income, and the mortgage payment cannot be more than 28 percent of your gross income.
2. What are mortgage options?
There might be more mortgage options than you realize. You can choose between an FHA home loan and a conventional loan. If you're in the military or a veteran, you might be eligible for a VA home loan.
A fixed-rate home loan is another option if you prefer predictable payments. Or, you can choose an adjustable-rate mortgage since these often start off with rates lower than a fixed rate. You can also select a mortgage term based on affordability, such as a 15-, 20- or 30-year mortgage.
3. How do I find the best interest rate?
Don't assume the first bank you contact will offer the best rate. GOBankingRates offers a free bank search tool. Using this tool, you can search banks and credit unions by state, city or region. With a side-by-side comparison, you can choose a financial institution offering the right loan with the best rates.