Tennessee
Home Financing and
Mortgages
Low interest rates along with
spectacular scenery are making Tennessee, and especially the city of
Chattanooga, a hot spot for buying a home. The market is especially good for
first-time buyers. There are several deals on mortgages and a slew of
upper-end properties for sale, because many people are upgrading, according
to Realty Times.
The Nashville area is also booming with January 2004
seeing a 14.6% rise in home sales compared to January 2003, according to the
Greater Nashville Association of Realtors. That was the fourth consecutive
year of growth. First-time buyers can get help with their down payments
through the Tennessee Housing Development Agency.
Perhaps the most frustrating part
about buying a new house is securing a good mortgage. The majority of people
can’t simply write a check for the price of their new house. They need to
borrow. There are a wide variety mortgages out there to help you secure the
financing you need to buy a new home.
A 30 year fixed mortgage, which has
a fixed interest rate, is a type of mortgage loan that is repaid by the
borrower making 360 equal monthly payments over a period of 30 years. Since
the borrower's payments are 'fixed', the borrower can expect to make the
same monthly payment for the entire term of the loan. A 30 year mortgage
loan is the most widely accepted program used to finance a residential
purchase.
Another type of mortgage is one where the interest rate changes over the
term of the loan depending on the prevailing interest rate. An Adjustable
Rate Mortgage (ARM) is a mortgage loan that is most widely known for its low
starting interest rate (when compared to the 30 & 15 year mortgage loans).
This 'low' introductory rate is used to calculate the mortgage payment for a
specified period of time. Once this introductory period is over, the
interest rate is adjusted periodically the yield on the one-year Treasury
Bill. |
