Home Buying 101

You have taken it upon yourself to live the dream of
owning your own home. It is now time to take the first
step and educate yourself on all there is to know about buying a home and mortgage loans. Yes, it can be overwhelming. ARM, APR, PMI, etc, what does it all mean? Franklin First is committed to helping you understand what you need to know, and our friendly mortgage specialists can guide you every step of the way. There are two ways to find the loan that best meets your present needs and future goals. Please continue to read or call one of our specialists.

Click here for valuable information related to your particular situation.

Purchasing your first home is a roller coaster of emotions that brings excitement, anticipation, and sometimes anxiety. Reduce your stress-level by educating yourself. Follow our guide to the home and mortgage purchase process, or call us now and talk to our Franklin First mortgage specialist

Here are some things you should consider when buying a house for the first time:

On many occasions, you will have to provide a down payment to purchase a home and obtain a mortgage. With a high credit score, you may be eligible to put no money down. If your credit is not good, you will have to put your own finances to work. Home mortgage lenders sometimes require you to provide 10-20% of the purchase price. By talking with one of our Franklin First mortgage specialists, we can determine the exact amount required for your down payment.

Certain adjustable rate mortgages (ARMs) and interest-only loans may be the best options for you if you plan on living in your residence on a short-term basis (less than 5 years). These particular mortgage loans might help you qualify for a higher valued home or end up costing you less than a fixed rate mortgage.

The future can always bring unexpected events. A new child, a change in employment or career change can be just a few. Some changes can be foreseen and others may not. When choosing a home, make sure you are considering that it will satisfy your needs at least for the near future (1-3 years).

There are different responsibilities when owning your home versus renting. Taxes, insurance, home owner associations (on occasion), maintenance and improvement expenses are just some of the costs that you need to plan for. Don't forget the addition to your monthly mortgage payment. Do not get over your head and make sure you calculate them when determining what you can afford.

You may have to move and start a new beginning in life. This may be stressfully and uneasy. Aside from finding a home and applying for a mortgage loan, you'll be uprooting yourself and your family, and perhaps adapting to a new lifestyle in a different part of the country.

Be honest with yourself and start looking at your financial situation and your goals. By doing so it may cut some of the anxiety of moving. Consider some of these import questions:

Timing is crucial when you are selling a current residence and moving into your new home. Coordinated between the buyers, sellers, real estate agents and lenders on both sides is crucial. Sticking to the deadlines set by all the parties, you’ll most likely avoid unnecessary fees and charges. Plan on moving? You should place your current home on the market as soon as possible to avoid the risk of having two mortgage payments at once. Speak with a Franklin First mortgage specialist to help you manage this complicated transition.

Mortgage lender's will require your credit risk score from reputable credit bureaus such as Equifax, Experian or TransUnion. This is known as your FICO score.The number calculated will help determine if you are a “good risk.” The higher the score, the better home mortgage options are available to you. The credit report factors in many items including:

Your credit history may prohibit some lenders from giving you a loan due to blemishes on your report. With our vast knowledge acquired over our many years of structuring mortgages allows Franklin First to provide mortgages when others can't. Each individual situation has hidden assets that will get you the loan.

Contact us and a mortgage loan specialist will be happy to discuss the many home mortgage options available for all types of home buyers, including those with not so good credit. To learn more about your credit, click here.

How much can you afford? Use our home affordability calculator and get an estimate of a price that would work within your monthly budget. Your payment will be influenced by how much you put down at closing. If you are selling your present house, ask your real estate agent for an estimate of its value. This will help you better determine what type of down payment you'll be able to put down on a new home.

Buying a second home as a vacation getaway or investment property is exciting. If this venture is for you, know that the mortgage process is a little different from a primary home mortgage.

Typically second home and investment property mortgages are generally harder to obtain than mortgage loans for primary homes. Having already one home mortgage, lenders need to solidify that you are still in good enough financial health to afford additional mortgage obligations. If times were to get tough, lenders believe that you are more likely to miss a payment on a home you don’t live in than on your primary residence. Compensating factors such as good credit and assets in the bank help in securing lower rates.

Investment loans typically require more money down and have more restrictions. Franklin First mortgage specialists experts will help you navigating the home mortgage market and find the best loan to serve your needs. We have hundreds of creative financing options for second home or investment property purchases.

Constructing your dream home is personally satisfying, but construction loans are tricky and there are high risks. The incorrect decision can cost you money since you are obtaining loan qualification for a property that does not yet exist. If a situation arise during construction, you may lose your qualification and need to re-qualify. This puts you in jeopardy of higher interest rates. Even more, if for some reason you cannot re-qualify, you may lose your down payment.

To protect yourself, you must become knowledgeable on different types of construction loans. Franklin First mortgage specialists are dedicated to putting you at ease and supporting you. If there is money to be save, we will help you find it.

Construction loans types:

Construction only loans are short-term loans. They are usually variable rate loans. During the time of the construction, you only pay interest on the amount that was disbursed to date. The entire loan amount will be due at the time of completion.

A construction-to-permanent loan is a mortgage that combines the construction costs with the permanent financing of your new home.

The benefit of a construction-to-permanent loan process is it simplifies the mortgage process. Construction-to-permanent loans involve only one set of loan documents, one closing and allow you to lock in your interest rate before the completion of your new home. Once you close on a construction-to-permanent loan, you’ll have up to twelve months to complete the construction. During the construction period, you will only be charged interest on the funds that were disbursed for the actual building of the property. Your permanent home mortgage begins when the construction is completed.

A bridge loan allows you to live in your current home while you are building your new one. With a bridge loan, you can use the equity in your current home for the down payment on a construction-to-permanent loan.