Frequently Asked Questions
How do I know how much I can afford?
Generally speaking, you can purchase a home with a value of two or three times your annual household income. However, the amount that you can borrow will also depend upon your employment history, credit history, current savings and debts, and the amount of down payment you are willing to make. You may also be able to take advantage of special loan programs for first-time buyers to purchase a home with a higher value. We can help you determine exactly how much you can afford.
What are the costs of owning a home?
When you are ready to buy a home you must consider that the monthly mortgage cost is not the only cost you will face. Maintenance costs—such as appliances needing repair and utility bills—will also come out of your pocket. You should also consider homeowner’s insurance as well as homeowner association or condo dues depending on your location. Also, be sure to remember to allow for property taxes which may be rolled into your monthly payment.
What is the difference between a fixed-rate loan and an adjustable-rate loan?
With a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, typically in relation to an index. While the monthly payments that you make with a fixed-rate mortgage are relatively stable, payments on an ARM will likely change. There are advantages and disadvantages to each type of mortgage, so contact us to help decide which is the best for you.
What are the benefits of home ownership?
Knowing that the house is yours brings you satisfaction in itself, however, you can enjoy the savings that can come when you deduct your property taxes and mortgage loan interest on your federal income taxes. In most cases, you can also deduct taxes and interests from state income taxes too. Since interest will make up a large portion of your monthly mortgage for many years you will easily see how homeownership can save you on your taxes. With every payment, you build more equity in your house. This equity is like a savings account that you can cash in when you sell your home or use it to borrow against.
How do I know which type of mortgage is best for me?
There is no simple formula to determine the type of mortgage that is best for you. This choice depends on a number of factors, including your current financial situation and how long you intend to keep your house. We can help you evaluate your choices and help you make the most appropriate decision.
What will happen at closing?
At closing, you, your agent, the seller, the seller’s agent (in most cases), and the escrow agent will sit down to go over the legal documents regarding your new home. A good escrow agent will explain what each document means. You should make sure you understand what you are signing and ask questions if you don’t. After all the paperwork is signed, you will pay closing costs and down payment to the escrow agent.
If you have additional questions, please contact an RMMC Mortgage Loan Specialist today!
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We have helped more than 20,000 El Paso families realize their dream of HOMEOWNERSHIP.
We have helped more than 20,000 El Paso families realize their dream of HOME OWNERSHIP.