Buying Your First Home? Asking These Questions Now May Help Stop Foreclosure In The Future.

If you have never owned real estate before right now could be the perfect time for you to buy. If you have some money saved the real estate market is still down and there are some really great deals. You may even be able to buy a foreclosure or short sale and get an even better deal.

While it may be a good time to buy the home buying process is still extremely stressful and if you are buying a home that is in foreclosure it can get a lot more complicated. Shine from Yahoo! reported that anyone buying their first home should do their research and hire a team of experts to work with them through the process.

Any Chicago real estate attorney will tell you that you can't ask to many questions when it comes to buying a home. Having a qualified real estate agent is great but you also need a real estate lawyer and a mortgage broker.

According to Shine for Yahoo!, working with a mortgage broker to determine how much of a loan you qualify for is a great first step. When working with a mortgage expert make sure to ask these questions. Understanding your mortgage may help you to avoid foreclosure in the future.

1. How long is the mortgage for?
It is common for a mortgage to be 30 years however there are 15 and 20 year mortgages. The term of the mortgage will make a big difference in the interest paid over the life of the loan.

2. Interest Rate
Interest rates are very low right now, which is another great reason to buy a home. However not all interest rates are created equal. There are some rates that are extremely low but adjust after 3 to 5 years while others are fixed at the same rate for 30 years. This is something you need to understand and seriously consider before signing into a mortgage product.

3. Closing Costs
When you get a mortgage there are costs associated with closing on the home. These fees are typically between $2,000 and $3,000. If your mortgage person is suggesting closing fees of much more than that it might be a red flag about the mortgage company you're working with.

4. Penalty For Pre-payment
Some mortgage companies actually punish you for paying your mortgage off to quickly. This is something you want to know in advance.

5. First-Time Homebuyer Benefits
The government as well as individual states have done a lot of first time homebuyer programs. This is something you want to know about when shopping for your first home.

The better you understand the terms of the loan you enter into the more likely you will be to stop foreclosure in the future. Some people default on their loans because they do not understand the terms they agreed to. The more questions you ask the more knowledgeable you will be.

Chang and Carlin
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