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So, gone are the loans that didn't require the borrower to show any proof of income, or that let homeowners make minimum payments, what is the scenario now? A significantly tougher one.

For consumer information we suggest you check the Texas Mortgage Bankers Association where important tips on what to ask the lender and related topics are provided and updated routinely. 

For an overview on various types of mortgages click here.

Buyers looking for a traditional mortgage may be interested to know that in this new scenario paying up-front points is worth the investment more than it used to be. Borrowers can pay points - at closing only, up-front fees - to reduce their mortgage's interest rate over the life of the loan. One point represents a percentage % of the mortgage value, the percentage valuedepends on the type of mortgage.

This option may not be very interesting if you plan to hold the loan for a short period of time (planning to refinance or selling the house). This upfront money may be entirely recovered within a year from the reduced monthly mortgage.

Rates are still quite low and locking is also very advisable as waiting for a better deal may, if the rate you have make your deal work, is not worth it. It is a fact that interest rates increase much faster than they inch down, which means that buyers are more likely to get stuck with a higher mortgage rate than they are to get a lower one because they waited.

Lenders requires private mortgage insurance if your down payment is less than 20%, should you put more if you can? Your call, but in unsteady market betting with your cash on the value of your home to remain stable might be risky. High down payments can be wiped out in severely declining markets.

Your realtor could assist you in finding institutions that can provide you with detailed information on the different mortgages.





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