Dont Become A Mortgage Industry Crisis Statistic

Dont Become A Mortgage Industry Crisis Statistic



Don't Become a​ Mortgage Industry Crisis Statistic
It's no secret that the​ U.S .​
housing marketing is​ having one of​ its largest slumps since the​ early 1980s .​
Pick up a​ newspaper or​ turn on​ the​ news and you​ are inundated with a​ daily report of​ more foreclosures,​ people falling further behind on​ their payments and a​ general souring of​ the​ entire housing and mortgage market .​
However,​ even during this downturn there are those who are continuing to​ buy the​ home of​ their dreams and taking out mortgages to​ help finance that dream .​

How can the​ savvy consumer make sure that they are not caught up in​ the​ mortgage crisis and not become just another statistic? By examining the​ type of​ house and mortgage you​ want to​ take out,​ as​ well as​ doing a​ little planning before you​ make the​ plunge,​ can mean all the​ difference in​ the​ world between making it​ or​ falling into the​ ever-widening black hole.
One of​ the​ reasons the​ mortgage industry is​ being hit so hard right now by defaults is​ that credit standards were relaxed to​ the​ point that many people who in​ a​ normal marketplace would not qualify for a​ mortgage were granted the​ loan .​
to​ their credit,​ some of​ these people are maintaining a​ stellar record and are on​ their way to​ owning their own house .​
Yet for many others they quickly got themselves into a​ situation where they could not financially afford the​ mortgage they were in​ thanks to​ adjustable interest rates and buying more house than they could afford.
One thing anyone who is​ looking into buying a​ house should ask themselves is​ how much house do they really need? Americans have tended to​ buy bigger and newer,​ which raises the​ cost of​ a​ typical house considerably,​ especially in​ areas where land prices are high .​
a​ mortgage company is​ not in​ the​ business of​ determining how much house you​ need - they are only looking at​ your financial ability to​ repay the​ mortgage .​

Though you​ may be able to​ squeak by and get approved,​ how much is​ that larger house pushing you​ to​ the​ edge where one slip and you​ fall behind because you​ cannot afford it?
Of course,​ it​ goes without saying the​ better your credit the​ lower your interest rates .​
Even in​ times when lenders tighten their credit criteria for lending new loans you​ will always benefit by cleaning up your credit before you​ buy a​ house .​
Ever quarter of​ a​ point you​ can lower your interest rate can translate into tens of​ thousands of​ dollars of​ potential interest you​ do not have to​ pay.
Speaking of​ credit,​ make sure that you​ are putting down as​ much as​ you​ can possibly afford towards a​ down payment when you​ go to​ purchase a​ house .​

The more you​ put down the​ less likely mortgage lenders are going to​ require that you​ buy insurance on​ the​ loan .​

Typically,​ you​ should aim for between 10-15% of​ the​ home's value as​ a​ down payment .​
Again,​ for every dollar you​ put down towards the​ down payment on​ a​ house now,​ the​ less interest you​ will pay in​ the​ future - not to​ mention unnecessary insurance payments .​
Mortgage lenders want to​ see that you​ are serious about buying and paying for that house before they give you​ the​ best deals.




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