Your Guide to the Different Types of Home Loans

by Jeremy

You know that you’re an adult when you decide to own your own home. Homeowners everywhere make it sound so easy, don’t they? Your peers and friends talk endlessly about negotiating a new monthly payment and how having no landlords but themselves gives them the freedom they wouldn’t ordinarily have. Ads on the T.V., too, endlessly going on about home equity and how this or that lender will offer you the best rates on your mortgage, are doing nothing but enticing you to join the other homeowners and start the process of buying your place.

In fairness, it isn’t a wrong choice to make. Many homeowners are incredibly comfortable now, and some repeat homebuyers earn quite a tidy sum of money by renting out properties. Considering how much the recent pandemic has forced families to isolate themselves, it shouldn’t be a surprise to see that some home loans offer people to put all family members into one property. So-called “granny flats” or “in-law suites” are additional apartments connected to the primary home in which your or your spouse’s parents and older relatives live. These can be garage apartments built into what is already there or an extra build attached to the home. Either way, they increase your home equity considerably, should you come to sell later on down the line.

Before you get there, you first need to own a home, and for that, you’ll need a mortgage.

Home Loans

A mortgage? What about a home loan?

First off, a mortgage is a home loan, and it comes in different forms. We’ll get into that in a moment, but the first thing to learn is how you’re given a home loan in the first place. Having found your dream home and comparing different home loan options online, you can pick a lender with the best mortgage rates. This mortgage lender runs a series of credit checks to ensure that you have enough equity to pay back the home loan over monthly payments without problems. This is known as pre-approval, but this is a little misleading. There’s no guarantee that your lender will give you the loan. long-standing

You don’t need excellent credit, but it helps not have any long-standing debtor hit at least the minimum credit score. After a little bit of negotiation, your lender (which could be a bank or a mortgage company) will make some rate adjustments, and then you’ll have your home loan ready to go.

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