First Time Home Buyer Information

Our St. Louis mortgage lenders can guarantee that you will learn a lot about mortgages in the home buying process. That’s why USA Mortgage works to make home buying a positive learning experience as well as help you take the next steps into a new home. We have compiled 4 things we feel you should know about mortgages:

  • Small changes in interest rates can make a big difference. If you have a 30-year fixed mortgage on a $200,000 home at a 6.5% interest rate and a 20% down payment, your monthly payment will be $1,011. If the interest rate drops a tad bit to 5.625%, your mortgage payment all of a sudden becomes $921. This results in a $90 savings per month and over $1,000 per year. That could potentially save you more than $30,000 over your entire loan period.
  • Adjustable rate mortgages (ARMs) are limited in how much they can adjust per year. You can breathe a sigh of relief knowing that ARMs are not as risky as they may seem. While interest rates may climb over time, your mortgage rate doesn’t have to. ARMs typically have a cap on how much interest rates can increase each year.
  • Paying points up front may work to your benefit if you plan to stay in your home for many years. Points are an additional fee you can pay when you close on your home and are expressed as a percentage of your loan. For example, on a $200,000 loan, two points amount to $4,000. If you pay these points up front during the closing, often times it leads to a lower interest rate. If you plan to stay in your home for several years or even decades, this may be a wise purchasing decision.
  • Start saving for your Down payment.  Even if you are approved for a program with little or no down payment, you need to start putting money away.  You may be required to pay for a termite inspection, home inspection or occupancy permit out of pocket.  Having money put away will help get items taken care of quickly.  Whatever is left over after closing can be put to use adding touches that make your new house a home.

There are enough details and insights to the home buying experience to complete a library of books! Let our experienced St. Louis mortgage company break down all of the information for you so you can feel prepared to become a first-time homebuyer. Be sure to check back with us for more insights and resourceful information.