Getting a Mortgage
If you're like most buyers, a home is the most
expensive purchase you'll ever make, and you'll probably need some form of
There are many lending institutions that offer a
variety of mortgage products. Financing options and rates can vary widely,
so it is important to do your research and shop around to ensure you get the
mortgage that best meets your needs at the best price.
Condo Financing is available in
many Downtown Orlando Condo buildings. 25% Down is typical for obtaining a
condo loan however, FHA approved properties could be financed for little as 3 1/2%.
Downtown Orlando FHA Approved Condos included The VUE, 101 Eola and 530 E.
I would be happy to refer you to some very good
mortgage contacts or assist in any other way I can to ensure you secure the
best possible rate for your home purchase.
What is a Mortgage?
A mortgage is a loan to finance he purchase of a home, and it is probably
the largest debt you'll ever take on.
Your home is the collateral for the loan, which is also a legal contract you
sign to promise that you'll pay the debt, with interest and other costs,
typically over 15 to 30 years.
If you don't pay the debt, the lender has the right to take back the property
and sell it to cover the debt; this is called repossession.
To repay the mortgage debt, you make monthly installments or payments that
typically include the principal, interest, taxes and insurance, together known
Principal and Interest
Principal: The principal is the sum of money you borrowed to
buy your home. Before the principal is financed you can give the lender a sum of
cash called a down payment to reduce the amount of money that
Interest: Usually expressed as a percentage called the
interest rate, interest is what the lender charges you to use the money you
borrowed. In addition to the given rate, the lender could also charge you points
and additional loan costs. Each point is charged at the rate of one percent of
the financed amount and points are financed along with the principal.
Principal and interest comprise the bulk of your monthly payments in a
process called amortization, which reduces your debt over a
fixed period of time. Each payment includes both an interest payment portion and
a principal payment portion. With amortization, the interest payment portion is
higher in early years and principal payment portion is higher in later years.
Taxes and Insurance
In addition to your principal and interest, your mortgage payment could
include money that's deposited in an escrow or trust
account to pay certain taxes and insurance.
Generally, if your down payment is less than 20 percent of the loan, your
lender considers your loan riskier than those with larger down payments. (Note
that the percent amount varies from place to place – in some places it could be
25 percent in others 20 percent - check with local lenders.) To offset that
risk, the lender sets up the escrow account to collect those additional
expenses, which are rolled into your monthly mortgage payment.
Taxes: The taxes are property taxes your community levies
based on a percentage of the value of your home. The tax is generally used to
help finance the cost of running your community, e.g., to build schools, roads,
infrastructure and other needs. You must pay property taxes even if you don't
need an escrow account and even after your mortgage is paid off.
Insurance: Lenders won't let you close the deal on your home
purchase if you don't have home insurance (also called
hazard insurance), which covers your home and your personal property
against losses from fire, theft, bad weather and other causes. Even if you pay
cash for your home, you should buy home insurance unless you can afford to
repair or rebuild your home if it's damaged or destroyed.
If your home is in a federally designated high flood risk zone within a flood
plain and you are signing for a federally insured loan, federal law mandates
that you must buy flood insurance. If you are not in a high
flood risk zone, you can still buy the coverage. Source: Top Producer Websites
steps to getting a mortgage.