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If you have decided to buy a house, it is necessary that you know what a mortgage loan is and what advantages or disadvantages it brings in its package. It is also possible that you do not want to buy a house and that you only want to remodel the one you already have. So it is important and necessary to analyze the whole situation and know that it is not necessary to have the total price of the house when you can opt for this financing.
In the United States, this is a loan granted by a bank to a client who is looking to buy or remodel a house, and even if he wants to build it from scratch, in the same way it can be granted to refinance a mortgage. The bank requires an initial payment and monthly payments with interests between 3 and 5% or even more. Said rates can be guaranteed, fixed or variable. It should be noted that not only banks make such loans but also commercial banks, online, credit unions and government finance companies.
Let's get to the point, these loans offer advantages such as buying a home in less time and can even grant you the loan without a down payment. In the United States there are options such as the FHA (Federal Housing Administration) programs in which the government supports you against the lender when you buy your first home.
Another advantage is that they have low interest rates, they provide special credits to low-income people and veterans.
On the other hand, there are disadvantages that you must take into account, for example, the collection of commissions from real estate agents can reach up to 3% on the amount of the loan. Interest rates can be increased during negotiation with the bank.
On the other hand, mortgage loans are available to people with a good credit score of more than 580 points and the shortest period for the credit to be approved is 30 days.
Now, all is not lost, you can work on your credit repair before applying for your mortgage loan. We call this preparing the perfect setting for the construction of your dreams.