Owning a beautiful home is now no longer a luxury but has become a necessity. However, because of a worldwide increase in the population; owning a piece of land has also become more expensive. Which is why many big names in real estate are now trying to offer potential customers more than just a house? Access to facilities such as a mini golf course, a gym, a sports club, etc can be yours for a higher price.
Destinations such as Florida and California in the USA have always been property hotspots. Not only are they famous tourist destinations, but the sunny weather is also loved by many. All the more reason why unless you are a millionaire, chances are you would still need a mortgage to buy that dream house. Finding the right mortgage deal for you works the same way as anywhere else.
You have to have a clear idea about your financial situation and also how much you can afford to pay for the next few years. After you have decided that, the first most important step would be to ask around. Do not be shy about meeting up with people and getting information. First hand information and a small idea about the real estate market would go a long way in getting the right deal. Simultaneously, do a small check on the kind of brokers in the market. Always go for a broker who has the right credentials and who has proper authorization to conduct business. Once you have settled on the right kind of broker, it is easier to move on to step three.
Step three involves finding the right mortgage lender. Finding the right lender is very crucial. Especially, as he will be the one who give you the necessary money to buy the house. Finding a lender who you are comfortable with, and who is willing to answer any doubts or questions that you have is very important. Remember that this is one person you will be dealing with and probably seeing for the next number of years. Banks are usually the more preferred money lender because they are thought to be more credible in nature.
Remember to discuss these few things with your money lender-
- What is the down payment you would have to give, if any?
- What is the interest rate that you have to pay?
- Also, whether the interest rate would be fixed or variable?
- What are the fees of the money lender which incur during the transaction and after sealing the deal?
- What are the other terms and clauses of the contract if any?
- Discuss any other hidden costs.
- Money lenders in Florida also charge what is called as a Private Mortgage Insurance, which works like a cover for them, in case a client is unable to pay the whole amount due to them. This too, needs to be cleared before signing anything.
- Ask the money lender to show you any other mortgage contracts he would have made for other house owners.
- Always clear any doubts regarding the contract itself before you sign anything.
Negotiating with a moneylender you have chosen is also important. Interest rates are of two types. The first one is called a Fixed Rate Mortgage or an FRM. Here, the rate of interest is fixed, for the entire payment period. This kind of an interest rate is good if you are fixed on staying at the same property for a few years. Not only does it enable better planning on a monthly basis but it also helps you to forecast your monthly expenditures. The second kind of interest rate is called an Adjustable Rate Mortgage or an ARM. Here the interest rate changes or varies at certain pre decided points in the payment period. This kind of deal works best if you do not have a lot of money on you at the current time, and if you are about to come into some money at a later time for example through an inheritance. Secondly, if you are certain that the prices of real estate would drop after a few months or years; you could also be eligible for a mortgage refinancing. This would prove especially worthy your while if the prices of real estate have fallen from the time that of purchasing your house to the time of applying for a refinance.
Moneylenders and brokers in these places would be used to seeing people who wish to buy property in expensive localities but are not always able to do so. It is important to be careful of any brokers who may appear over friendly or over eager to push a deal. They could just be fraudsters looking for a victim. There is always a possibility that you may end up giving cash and ending up getting none yourself. It is safer to go with a person who is recommended to you by a friend, neighbor or relative. While taking the suggestions of a lender or broker is good because they would be the best people to advise you, also be clear about your terms and conditions. It is important to always be clear about how long you can afford to keep paying the mortgage, and what kind of a deal suits you best. Keep in mind that being expensive cities themselves, the costs of simply hiring a broker itself would be higher than in most other places. Make sure you are not cheated at any time, and try securing the best deal possible.