Frequently Asked Mortgage Questions

The market

The right time to buy a house depends on various factors, including your personal circumstances and the current housing market conditions. Here are a few points to consider:

  1. Market Conditions: Research the current state of the housing market in your desired location. Look into factors such as home prices, inventory levels, and trends in interest rates. A buyer's market, where there are more homes available and prices are lower, may indicate a favorable time to buy.

  2. Financial Readiness: Evaluate your financial situation, including your savings, income stability, and credit score. Determine if you have enough funds for a down payment, closing costs, and ongoing homeownership expenses. Additionally, consider your long-term financial goals and whether buying a house aligns with them.

  3. Affordability and Mortgage Rates: Examine the affordability of homeownership by assessing your budget, including potential mortgage payments, property taxes, insurance, and maintenance costs. Also, keep an eye on mortgage interest rates, as lower rates can positively impact your monthly payments and overall borrowing costs.

  4. Future Plans: Consider your future plans and how they align with buying a house. Evaluate factors such as job stability, the desire for a long-term residence, and potential life changes that may affect your housing needs.

We would be happy to discuss your goals and provide more personalized advice based on your specific situation and local market conditions. Click Apply Now to kick start the process or search for a Loan Officer on our team. 

Our loan officers are happy to give you a holistic picture of your loan compared to other options using a total cost analysis. It will compare loan terms, pricing, and options to give you a clear understanding how each would affect your financial position over time. Through this analysis you may find a better loan option, or you very well may already have the best one. Find a loan officer to get started!

Determining how much you can afford to pay for a home involves considering several factors, including your income, expenses, savings, and financial goals. Here's a general guideline to help you get started:

  1. Evaluate Your Finances: Take a close look at your current financial situation. Consider your monthly income, including any stable sources of income, and subtract your monthly expenses. This will give you an idea of how much you have available for housing costs.

  2. Calculate Debt-to-Income Ratio (DTI): Your DTI ratio compares your monthly debt payments to your pre-tax income. Most lenders recommend that your total debt, including your mortgage payment, should not exceed 43% of your gross monthly income. Calculate your DTI ratio to understand how much of your income is already allocated to debt payments.

  3. Consider Down Payment: Determine how much you can afford to put towards a down payment. While it's common to aim for a 20% down payment, there are loan programs available that require lower down payments. However, keep in mind that a higher down payment can lower your monthly mortgage payments and may help you secure better loan terms.

  4. Factor in Additional Costs: Remember to consider other costs associated with homeownership, such as property taxes, insurance, maintenance, and potential homeowners association (HOA) fees. These costs can vary based on the location and type of property you're considering.

  5. Get Pre-Approved: Consider getting pre-approved for a mortgage from a reputable lender. Pre-approval will give you a more accurate estimate of how much you can borrow based on your financial situation, creditworthiness, and other factors.

While these guidelines can provide a starting point, it's important to carefully review your specific financial situation and consult with a mortgage professional to get personalized advice tailored to your needs.

The jargon

This is the ratio of all your monthly debt payments, including the payment for your new mortgage, divided by your gross monthly income. This ratio is one way a lender determines your ability to manage your monthly mortgage payments and repay your loan.

Closing costs are fees and expenses for completing your mortgage loan transaction. These costs are typically 3%-6% of the loan amount and may include origination fees, taxes, insurance premiums as well as title and record filing fees. Keller Mortgage is required by law to provide you with a loan estimate when you submit certain information including your name, social security number, income, subject property address, estimated property value, and estimated loan amount.

This is a type of insurance that protects the lender against losses while allowing you, the borrower, to qualify for mortgage financing with a down payment of less than 20% and as low as 3% of the purchase price.