In a recent survey taken from Zillow, 1/3 of home-buyers answered these basic mortgage questions incorrectly. Do you know your basics? Answer these questions and see if you know your stuff.
1. True or False: It is impossible to get a mortgage for less than 5% down.
False. Loans ensures by the Federal Housing Administration (FHA), for example, can require as little as 3.5% down.
2. True or False: It is always best to stick with the bank where you currently have your savings and checking accounts when getting a mortgage, because you will get the best deal.
False. Not always. Often competing banks can cut this down by large margins.
3. True or False. Shopping with financing already in place can make for the faster buy.
True. However, know that you are NOT obligated to close the deal with those loans. If there are better terms available, and there often are, you should take them.
4. True or False. Underwater mortgages (where borrows owe more than the homes are worth) cannot be refinanced.
False. They can be refinanced into lower rate loans.
5. True or False. If you go through a foreclosure or short sale situation, you do not always have to wait a full seven years for your credit score to recover.
True. Homeowners with short sales can, in fact, obtain financing that enables you to buy another home in as little as 2 years.
How did you do? If you got 2 or more wrong, don't worry - you're not alone. Its always best to consult a professional to help ensure you are truly getting your best deal. If you have questions about what your mortgage could look like, let's discuss your priorities, send me an email or give me a call.
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