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Prepare to Buy Your First Home

Buying your first home in Placer Hills can be exciting yet overwhelming. Understanding mortgage options is crucial. Fixed-rate mortgages provide stable interest rates throughout the loan's life, while adjustable-rate mortgages (ARMs) offer low initial rates for the first 5-7 years, making them suitable for short-term buyers. Be aware of mortgage points, which are fees that can add up if your down payment is less than 20%. Planning well can help you avoid extra costs and make the home-buying process smoother.

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Prepare to Buy Your First Home

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  1. Prepare to Buy Your First Home Placer Hills Real Estate

  2. Learn About Mortgages • Fixed rate mortgage • The same interest rate for the life of the loan • Adjustable rate mortgage (ARMs) • Very low introductory rate for 5-7 years • Much higher rate after 5-7 years • For short-term buyers or those planning to “flip” • Can be dangerous

  3. Mortgage Points • Fees paid to the lender • One point equals 1% of mortgage value • Required if buyer has less than 20% down payment • Can be used to buy down mortgage rate

  4. Fixed Mortgage Rate Averages Information based on Freddie Mac data Http://www.freddiemac.com/pmms

  5. Sample Fixed Rate Payments $250,000 Lender rates are influenced by credit scores Plan for a 20% down payment to avoid cost of points Add taxes and insurance premiums

  6. Buying Is a Huge Decision

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