Seller Tips: What You Need To Know About Mortgages in 2020 

Mortgage rates have been dropping steadily throughout this year, with rates currently at a historic low! Lat week, we wrote about the 3 biggest things to keep in mind when refinancing your mortgage, and we’ve gotten some questions about how exactly mortgage rates work, what they are, and how you qualify. Keep reading for a few more tips to help you better understand mortgages! 

Since we last discussed mortgage rates in our 2020 COVID Market Overview, 30-year fixed rates were steady at 2.81% and have only increased by .03% since, with current rates at 2.84%. This is the time to contact a lender partner because rates this low haven’t been seen in over a decade! 

Mortgage Rates - What Are They

1. What Really Is It?

A mortgage is a loan from a bank (or other financial institution) that helps a you (the borrower) purchase a home. The collateral for the mortgage is the home itself, meaning that if the borrower doesn't make monthly payments to the lender, the bank can sell the home.

Mortgage Rates: How Do They Work

2. How Does It Work?

For first time home buyers, a minimum credit score of 580 is required, and as little as 3.5% down (or a credit score of 500 to 579 with at least 10 percent down). A lender partner will go through your financials to determine how much you can afford to borrow and pay each month.

Mortgage Rates - How Much Do I Pay
Mortgage Rates - What Happens If I Don't Pay

3. How Much Do I Have To Pay?

While this number will vary based on a variety of factors including your personal financials and region, however, paying a little extra each month toward your mortgage is always an option. This will reduce the principal on your mortgage, as well as the total amount of interest owed!


4. What Happens If I Don’t Pay?

There are two ways a lender can collect if you fall behind on payments. A lender can go through the courts in a process called judicial foreclosure, or through a trustee in a process called non-judicial foreclosure.

If you’re ready to begin your home search, a great place to start is by looking for a lender partner. Luckily, we work closely with a team of incredibly talented lenders at Guaranteed Rate who can help get your on your way to your new home. Contact Jason and Mike here to get started!


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Venture Philly Group

Buy. Sell. Invest.

info@venturephilly.com

o. 215.592.9522

1619 Walnut Street, Suite 500, Philadelphia, PA

venturephilly.com


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