This year, you can say that buying a Miami real estate property or any home in any place in the country remains the same since the market collapsed. This is evident in the difficulty of acquiring a loan. Now that lenders are tightening their belts (read: strict qualifications), it’s harder to find a suitable mortgage term and rate, much less qualify for a loan. Still, there are ways to help you purchase the home you want. These here are but some simple tips to consider.

Consider choosing an ARM

Since mortgage rates are expected to grow, adjustable-rate mortgages are becoming an excellent option. You should consider this mortgage term when buying your Miami real estate property.

Nowadays, a 5/1 ARM is the most popular term. This carries a starting rate that persists for five years and has the potential of changing yearly thereafter. When compared with a 30-year fixed mortgage, the rate of a 5/1 ARM is lower, making it a good viable option when buying a Miami real estate property.

Always check your credit first

The importance of having an excellent credit score cannot be stressed enough. It takes a score of 720 or more to get a combination of attractive points and fees. Now, borrowers should have scores of 740 or up to get the best homebuying deals.

Look at different angles

When you are financing a home, you must always look at several different scenarios. Several combinations of loan type and discount points are usually helpful in pointing you to the right direction. For instance, if you plan on staying at the house for almost ten years, compare the feels and monthly payments you would make under other loan deals. How high is the rate if you don’t want to pay for discount points? Is it going to be more advantageous than paying for discount points to get lower rates?

Always know your options

Regardless of whether you have small down payment or don’t have one, there are options available; you shouldn’t just stick to unconventional loans. FHA loans, for instance, are excellent for those who have small down payments; while VA loans for people who don’t have any down payment at all.

Know what to do if you fall behind

Finally, when you are falling behind your payments, always consult a counselor immediately lest you lose your Miami real estate property to foreclosure. Those who undergo foreclosure counseling are more likely to receive mortgage modifications and even lower payments.

Mark Michael Ferrer

Miami Real Estate