Embarking on the journey to homeownership is an exhilarating experience, but it comes with its…
How Does a Mortgage Work Anyway?
If you plan to purchase a home, you have probably started to research the best mortgage options to make the most of your money. When looking at your home purchase, you have to consider both the actual cost of the home as well as your financing. Unless you are purchasing a home outright, you will probably have to take out a loan.
Your interest rate and any financing costs can make your monthly payments very different. A higher interest rate means that you pay your lender more to borrow the money used to purchase the home. Over the life of the loan, you will pay that percentage of the overall amount of money that you borrowed in addition to the principal amount used to purchase the home.
Understanding Your Monthly Mortgage Payments
Most mortgages are for 15 or 30 years. When you finalize your mortgage paperwork with your lender, they divide up the interest and principal amounts into monthly payments. They add in the cost of taxes and insurance. This total amount is your monthly mortgage payment.
Where is My Money Going?
The early payments on your mortgage mostly go toward interest. Even though your monthly payment does not change beyond minor adjustments to account for changes in your insurance coverage or taxes. As you continue to pay down your mortgage, a greater percentage of your monthly payment will go toward the principal amount.
Can I Pay Extra?
You can make extra payments in most cases without a penalty. Making these early, especially if you designate them to go just toward the principal balance, can cut down on the interest that you pay and the amount of time that it takes to pay off your mortgage. This is a great strategy that can result in your owning your home free and clean, without a mortgage, sooner. It can also save you money!
Equity Now
Looking to buy a new home or refinance your existing mortgage? You can trust Equity Now, a direct lender with almost 40 years of experience in the industry, to provide you with exceptional service and great rates. Check out our reviews to see what our clients think.
Our team of experts is dedicated to guiding you through the home buying process, evaluating your application in-house, and finding the right mortgage solution for your specific needs. We offer a variety of mortgage options, including purchase mortgages and refinance mortgages, to help you achieve your financial goals.
At Equity Now, we understand that buying a home or refinancing your mortgage can be overwhelming. That’s why we’re committed to making it easy for you by handling everything in-house and making lending decisions quickly, so you can close in as little as two weeks.
We’re licensed to lend in five states – New York, New Jersey, Connecticut, Pennsylvania, and Florida – and we’re approved by the U.S. Department of Housing and Urban Development (HUD), Fannie Mae, Freddie Mac, VA, and FHA. We pride ourselves on being a direct lender, which means we have the flexibility to make lending decisions quickly and efficiently.
Our great rates and exceptional service have earned us a reputation as one of the best mortgage lenders in the business. We’re committed to providing our clients with the best possible rates and making the home buying or refinancing process as smooth and stress-free as possible.
Don’t settle for less than excellent rates and outstanding service. Contact Equity Now today to start your homebuying or mortgage refinancing journey with a trusted direct mortgage lender. We’ll guide you through the process and provide you with the best possible rates so you can achieve your financial goals and realize your dreams of owning a home.
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