Buying your first home, or purchasing a new home, is an exciting yet scary time. You are signing paperwork and trying to figure out what the bank is talking about all while making sure no one is taking advantage of you. Boynton Beach moving services know how frustrating it can be when you are buying a home, and don’t understand all the words being used in your discussions. So as a helpful tip, Boynton Beach moving services have put together a list of important mortgage terms that will leave you better prepared for your next meeting.
1. Appraisal, this one is a relatively common term and as you probably guessed it is the term used to reference the estimated value of your home. A home’s appraisal will give you a better idea if the asking price of the home on sale is a fair price. Banks also use this number as a determinant of how much they can lend you. More often than not, banks will not loan you much more than the appraisal amount of the home.
2. Down Payment is the amount you are expecting to pay out of pocket. The amount of the down payment can vary depending on your loan type as well as your personal ability to pay. Boynton Beach moving services such putting between 10 to 20 percent of the home’s value as your down payment.
3. Fixed-rate mortgage is another important mortgage term to know. This is a traditional mortgage, where you have the same interest rate throughout your entire loan term. With this type of loan, your mortgage payment will not increase due to interest.
4. Principal amount on a loan is the amount of money originally borrowed. During the life of your loan if you pay more on principal then you are paying off more of the amount originally owed and not just interest.
Knowing important mortgage terms can help make your transaction much easier and more understandable. Boynton Beach moving services hope our resources have helped make your moving experience easier.