Texas
Home Financing and
Mortgages
Being the largest state in the U.S.
has its advantages. Just ask Texas homeowner who enjoy extremely affordable
housing in a relatively stable market. Throughout the 1990’s builders
swarmed in on Texas building a slew of condos and new high-end developments.
The resulting supply glut has kept prices down and quality up. But now is
the chance to buy with interest rates at all-time lows and incentives for
first-time buyers in Texas at all-time highs. Developers in Texas are
clamouring to sell new homes and condos making 2004 a great year to buy.
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. |
