First-Time Buyer Program

Buying your first home may seem intimidating. That is why Constitution Mortgage set up a five step process for first-time home buyers to reference in achieving their homeownership dream.

1. Mortgage Overview
2. Choosing a Loan
3. Preapproval
4. Purchasing Your Home
5. Managing Your Investment

1. Mortgage Overview

A mortgage is a type of loan used for home financing. Annual Percent Rate (APR) is a significant factor in determining the cost of your mortgage. Three expenses which contribute to your APR include Interest Rate, Discount Points, and Loan Fees. In determining your monthly payment, four factors are involved: Principal, Interest, Taxes, and Insurance (PITI). 

2. Choosing a Loan

Understanding loan options available to you and determining which loan best fits your needs are essential to the home buying process. Most loans are either a fixed-rate mortgage or an adjustable-rate mortgage. Fixed-rate mortgage interest rates remain the same throughout the life of the loan, whereas adjustable-rate mortgage interest rates fluctuate based on the market. When choosing a loan, homebuyers must consider the length of the loan or loan term. Longer-term loans result in lower monthly payments over a longer period of time while shorter-term loans result in higher monthly payments over a shorter period of time.

3. Preapproval

Preapproval is a written agreement in which a lender agrees to finance your home up to a certain amount based on a thorough review of your financial situation. Preapproval not only determines the amount of money you can borrow to purchase a home, but it tells sellers you are ready to negotiate while revealing possible qualification problems early in the process.

4. Purchasing Your Home

When making an offer on a home, all offers should be put in writing. Once an offer is accepted, a purchase agreement is created between the buyer and seller. This agreement describes all the terms of the transaction. Before the closing, the loan should be reviewed with the lender and a survey of the property should be conducted. On the closing, the closing costs are paid and ownership is transferred to the buyer.

5. Managing Your Investment

Homeownership is one of the largest investments most people make and with that comes the financial responsibility to wisely manage this investment. Home equity loans, lines of credit and cash-out refinancing are options homeowners gain in order to access their home equity. This is where Constitution Mortgage can help review your needs to wisely manage your investment.