What You Need to Know

The "ideal" loan size is quite subjective and shouldn't default to how much the lender is willing to lend you. More importantly, it should be based on what you can afford. Your finances, preferences and priorities, among others, need to be taken into consideration to determine what you can afford. Read More...

Mortgage rates determine how much interest accrues on your home loan. The higher your rate, the more interest you'll compile and the more money you'll end up paying for your house. From a financial perspective, one of the single most important things you should be aware of is whether you have a fixed-rate mortgage or adjustable-rate mortgage. Read More...

Closing costs include a range of charges for services related to applying for a mortgage. These are the fees you pay when finalizing a real estate transaction, whether you’re refinancing a mortgage or buying a new home. These costs can amount to 2 to 5 percent of the mortgage balance so it’s important to be financially prepared for this expense. Read More...

APR, or Annual Percentage Rate, is a rate charged per year on an amount of money that is borrowed as a loan or invested which factors in associated fees in addition to the interest rate. It is designed to give a more accurate estimate of the total cost of a loan or investment than considering the interest rate alone would. Read More...

The loan term or mortgage loan term is the number of years you have to pay off your mortgage. A 15-year term means you have 15 years to pay off your mortgage, and a 30-year term means you have 30 years. You have a payment due each month.

A 30-year term normally has lower monthly payments than 15-year mortgages since your total mortgage balance is spread out over a longer period of time, resulting in smaller monthly payments.

A shorter term means your balance is spread over a shorter period of time, making your monthly payments higher.

Even though a conventional loan is the most common mortgage, it is surprisingly difficult to get. Borrowers need to have a minimum credit score of about 640 in order to qualify—the highest minimum score of all mortgage products—and have a debt-to-income ratio of 43% or less. Read More...

FHA stands for Federal Housing Administration, and the FHA is a government agency that insures mortgages. It was created just after the Great Depression, at a time when homeownership was prohibitively expensive and difficult to achieve because so many Americans lacked the savings and credit history to qualify for a loan. Read More...

A jumbo loan covers a larger-than-normal loan amount. Jumbo loans can be used for primary homes, investment properties and vacation homes. Aside from those distinctions, jumbo loans aren’t much different from traditional mortgages. Payment schedules and other details are generally the same. Borrowers can get fixed- or adjustable-rate jumbo mortgages with various term options. Read More...

A VA loan is a type of government loan, backed by the Department of Veterans Affairs (VA). The VA offers specific guarantees to private lenders that handle VA loans. Because of these guarantees, lenders will issue loans to candidates with no down payment or less stringent requirements than other loans. Read More...

A non-QM or non-qualified mortgage is a home loan designed to help home buyers who can't meet the strict criteria of a qualifying mortgage. For example, if you are self-employed or don't have all the necessary documentation to qualify for a traditional mortgage, you might need to look at non-qualified mortgages. Read More...