New Home Mortgage

A new home mortgage is a means by which a prospective house buyer can finance a new house. For most people, their house is the biggest investment they will ever make and the source of much of their future wealth. The way a borrower handles a home loan will have an impact on the rest of his life, even if he only stays in the house for a few years. Borrowers have many options to choose from when qualifying for the funding. Loans can be paid out over a variety of lengths, including ten years, fifteen years, twenty years, thirty years, and infrequently forty years. The best case scenario is to sign a loan for the least amount of time possible, but the size of the payments rise as the loan length is shortened. Therefore, the buyer must carefully weigh the size of the payment against budgeting concerns.

Although new home mortgages come in many different shapes and sizes, the first thing a borrower should investigate is whether to sign for a fixed interest rate (FRM) or an adjustable rate (ARM). A general rule is that a buyer who plans to stay in a house for more than three years should apply for a FRM. If the borrower plans to sell the house in less than three years, an ARM may fit the criteria. New home mortgages are not always designed to help the homeowner. A wise borrower will make sure that the lender is not offering higher interest rates or terms than the borrower can find elsewhere. Comparing loan terms from one lender to another for a new home mortgage is essential. The borrower also needs to research the fees, prepayment penalties, and other charges that will accrue with the loan, including closing costs. Closing costs are not simply an extra mortgage. They are fees assessed by the lender and can vary widely from one company to another. The Internet is an excellent tool for doing this research.

When looking for a new home mortgage, a well-educated decision reaches much farther than one that is made hastily or without thought. As Christians, we are responsible to handle our finances in a godly manner. First Corinthians 4:1-2 instructs us: "Let a man so account of us, as of the ministers of Christ, and stewards of the mysteries of God. Moreover, it is required in stewards, that a man be found faithful." We cannot fail to be good stewards, especially in such a far-reaching decision as finding new home mortgages.

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