If it is Fixed it is Secure

Just the sound of something fixed makes me feel secure, comforted, relaxed. Hence, I always opt for a fixed rate mortgage loan, and so should you, if you are like many.

I learned much from mom and dad, growing up. Dad was an entrepreneur, but a wise one. Never the risk taker if there is not something fixed to it. Mom had a successful career as a school teacher, and had the safety of incoming income. Both taught me to not take risks without viewing the whole picture, and althought I have not always been as wise and thrifty as my parents, the idea of something fixed resonates in my thinking.

The holy bible has stories about security, and a fixed establisment. One story is about a house built on the sand and a house built on a rock. Which house do you think is secure, fixed? Would we want to buy a house build on the sand? Yet we may do the similar when we think about expwrimenting with finances, and purchasing a home with an adjustible rate morthage, or a graduated payment mortgage, instead of getting a fixed rate mortgage.

I have suggested to people, real estate customers, that they will know what their principle and interest is each month if they stau fixed, getting a 30 year fixed rate mortgage. This type of loan has been the most popular and successful throughout most of modern time, certainly since the early part of the 20th century. It is not going away. However, just like me at times in my past, people sometimes neglect to listen to reason and instead, jump aboard the river of all these loan options where interest rates can go up, surprising even the best, or go down. Of course when that happens the monthly payment changes and we have a world of uncertainty and risk. We think that we will get a raise, make more money, not have financial or emergency issues, so we take mortgage loan risks. We want more home for less money to get in. This has been the thinking of so many in recent years, so a fixed financial product is put aside for the high risks associated with an adjustible rate mortgage ARM. Of course there is always risks in this world: someone can lose their job, have emergency expenses, home improvement needs, business failures, but at least with a fixed rate mortgage loan you know that the monthly interest and principle payment stays the same for the entire term of the loan.

Dad taught me to not fall for every frivolous, “too good to be true” opportunity that comes along, and instead, focus on what works, the basics, the fundamentals to our happiness and financial success. Think back to the fixed nature of the rock, the order of the universe, the ever flowing sun rays, the daily process of photosynthesis, the movement of the waves. All are fixed in a natural process of nature. No uncertainty in the normal process.

So, like my parents, I would suggest that home buyers look at 30 year, 20 year, or 15 year fixed rate mortgages, to see what fixed product works. I have had four homes, and for each, I always purchased with a 30 fixed rate mortgage loan. Do to the at times uncertainty of my income streams, that kind of mortgage loan has been a blessing.

Shopping for a Lender Before Buying Your Home

Some things are a given in buying a home in Tallahassee, and elsewhere. There are always going to be fees, fees, and more fees in a real estate transaction. However, we can minimize the fees significantly by shopping around when looking for a mortgage loan. When shopping for a lender, look for not just interest rates, and terms, but also look at lender fees.

There are three categories of fees that constitute a real estate closing in Tallahassee, and elsewhere:

1. Lender fees are the fees that a lender has control over. They can be presented as multiple fees, such as origination fees, administrative fees, transaction fees, processing fee, tax service fee, loan setup fee, funding fee, and others. There can also be one fee, covering all the fees, so when you are out comparing lenders, you can compare a total lender fee package with other lenders’ fees.

2. Third-party fees are fees that the lender does not control, however, may be able to negotiate the best deal on your behalf. These fees include appraisal, inspection, title, survey, and others.

3. Then, there are the prepaids, such as prepaid interest, and prepaid taxes.

 

Kenneth Fach, REALTOR
Weichert, REALTORS-Anchor
1607 Village Square Boulevard, Suite B103
Blog: http://KennethFach.wordpress.com
Cell 850-339-5753

Each office is independently owned and operated.

Closing costs and Tallahassee real estate

Some things are a given in buying a home in Tallahassee, and elsewhere. There are always going to be fees, fees, and more fees in a real estate transaction.  However, we can minimize the fees significantly by shopping around when looking for a mortgage loan. When shopping for a lender, look for not just interest rates, and terms, but also look at lender fees.

There are three categories of fees that constitute a real estate closing in Tallahassee, and elsewhere:

1. Lender fees are the fees that a lender has control over. They can be presented as multiple fees, such as origination fees, administrative fees, transaction fees, processing fee, tax service fee, loan setup fee,   funding fee,  and others. There can also be one fee, covering all the fees, so when you are out comparing lenders, you can compare a total lender fee package with other lenders’ fees.

2. Third-party fees are fees that the lender does not control, however, may be able to negotiate the best deal on your behalf. These fees include appraisal, inspection, title, survey, and others.

3. Then, there are the prepaids, such as prepaid interest, and prepaid taxes.

Kenneth Fach, REALTOR
Weichert, REALTORS-Anchor
1607 Village Square Boulevard, Suite B103
Blog: http://KennethFach.wordpress.com
Cell 850-339-5753

Each office is independently owned and operated.