Owning a home is a dream of many Americans. Not only is owning a home cheaper than renting in many areas, but a home is an investment that can earn equity over time.
Acquiring a Home Loan
While owning a home is a top dream for many, it can be a hard process to start. Purchasing a home requires good credit and a little bit of savings.
Getting pre-approved for a home loan before finding the house of your dreams is a smart step. Having a pre-approval on a loan can speed up the home-buying process, and it can help you know exactly what kind of home you can afford.
Pre-approvals can also make your offer look more appealing to the existing home owners, which means you have a better chance of having your offer accepted.
Types of Home Loans
The two most popular home loans are the 15- and 30-year loans, and both come with their advantages and disadvantages. A 15-year home loan typically has a higher monthly payment, but because it’s shorter, you can end up paying thousands of dollars less on interest.
A 30-year loan is popular among many Americans, since the monthly mortgage payments are lower. While a 15-year home loan might require some extra budgeting, it should be considered, since homeowners would cut their total interest and payment duration in half.
GOBankingRates offers expert advice on how to manage your mortgage, as well as the how-to for paying off your mortgage early. If you’re having trouble deciding between 15- and 30-year home loans, read GOBankingRates’ extensive articles on the different types of loans.