Myths About Mortgages You Should Consider When Looking at Santa Fe Realty
One of the biggest investments that you can perform today is to buy a home. Many people strive to accomplish this throughout their lives. They work hard and squirrel away enough money to afford a down payment on the home of our dreams. While this will get your foot into the door, it is not enough to keep you there. It is necessary to get a loan from a bank to complete the purchase. This loan is often regarded as mortgage. There are many myths about mortgages in Santa Fe Realty. Here they are debunked for you.
You must deposit 20% of the value of the house
One of the most prevailing myths about mortgages in Santa Fe Realty is that you have to deposit 20% of the value of the house. Around the nation, this amount is approximately similar to the average deposit amount. However, it is not a must that you put down this amount. As a matter of fact, a home buyer can deposit more or less than 20%. Depending on your financial capability, you can deposit as high as 30% or as low as 3%. It all depends on your cash in hand. Also, if you make a large deposit, you receive a low interest on your mortgage loan. On the other hand, if you make a low deposit, you receive a high interest on the loan. Therefore, it is all up to your financial ability.
Mortgages are expensive
Everyone who hears about mortgages for the first time imagines that they are supremely expensive. The complexity of a mortgage makes it seem as though it is only for the wealthy. The large percentages quoted when describing mortgages also attunes to their expense. However, this myth is far from the truth.
Mortgages are not expensive. They are simply loans which can be negotiated. This means that you can get a mortgage at an interest rate that is low. For example, it is possible to use your status as a first time home buyer with good credit to negotiate a mortgage whose down payment is 20% with a 5% interest rate. Thus, mortgages are not expensive because they can be negotiated.
You can only get a mortgage from a bank
This is one of the most popular and outstanding myths about mortgages. People are convinced that these financial benefits are only available from a bank. That’s because traditionally, people have had to go to banks for mortgages. Interestingly, today this is not the case. You can actually get a mortgage from an organization that’s not a bank.
There are several programs which are sponsored by the government or even non-governmental entities which provide home loans to people. Some examples of these are the Federal Housing Administration (FHA), Veterans Association (VA) and many more. Thus, the myth that mortgages are only sourced from banks is inaccurate. You can get this type of loan from many other types of establishments.
The mortgage industry is plagued by myths. Many of these are simply inaccurate. They can mislead or intimidate new home buyers. Thankfully, they are demystified here. You can get an affordable mortgage from an entity that’s not a bank. Try it today or talk to your Santa Fe, NM real estate agent to learn more.