Did you know that the monthly rent you pay for an apartment or house could cost the same or even more than a mortgage? Determining which First Time Home Buyers Programs in Portage MI could save folks plenty of headaches, time, and money. But where should one begin this exciting journey?
What every person should know about mortgages
These are some of the terms individuals should know before applying for a mortgage loan.
* Debtor: With a mortgage loan, the potential homeowner is the debtor, that is, the person who takes out a loan with the financial institution and who transfers the power or right of ownership to said financial entity.
* Creditor: The creditor, in this case, the bank or financial institution, is the establishment that is legitimately authorized to demand payment or fulfillment of the obligation or debt. This means that the creditor is the one to whom the right to property was transferred.
* Guarantor: The guarantor, is an additional person that sometimes asks the financial institutions to grant people a mortgage loan. This must be a person with a fixed salary or real estate that can support the debt in case you do not comply with the terms of the mortgage. Not all financial institutions ask for this, nor do all mortgage loans need one.
* Percentage of funding: This refers to the percentage of which is being lent. Banks usually lend debtors 70 to 100% of the money they need to buy a home. This percentage can vary, depending on if the house is new or used.
Other terms to recognize
There are plenty of other terms potential buyers need to understand before moving forward. For example, the maximum amount of a loan is the maximum amount of money the bank is willing to give a person for their stated reason. This can vary according to the type of home.
First Time Home Buyers Programs in Portage MI tend to focus on the “term” of said loan, too. This is the amount of time for which the financial institution is willing to lend a person the money they need. Mortgage loans are mostly long-term, between 15 and 40 years. Contact us for more details.