A 30-year fixed mortgage loan is a mortgage in which your monthly interest rates and principal payments remain the same throughout the loan. 30-year mortgage program is a very commonly used home loan program in Texas. The loan gets paid off completely within 30 years. And it provides great flexibility and comfort with a fixed monthly payment and low mortgage rates. The main issue with this loan program is that you will need to pay more in interest due to the duration of the mortgage as compared to the 15-year mortgage.
The Lowdown on 30 Year Fixed Rate Mortgage...
How does the 30-year mortgage loan program work?
In a 30-year mortgage rate, the balance shrinks down more slowly but the buyer is borrowing the same amount twice or more for a longer period. As 30-year mortgages are riskier for banks in a long term. It has higher interest rates. But the main benefit is that it offers relatively low monthly payments. It will help the borrower to save more in long run.
Monthly payment in a 30-year mortgage loan is typically 40% less as compared to a 15-year loan program. And interest rate will be 0.25% and 0.75% higher.
Why a 30-year fixed-rate mortgage?
If you cannot afford the higher monthly payment and are looking for a home to live in for a long-term period of more than 7 years. Then this loan program allows you to build equity in the home you are going to start.
Do I Qualify?
- Minimum 3% down payment
- A minimum credit score of 620
- A debt-to-income ratio of not more than 50%
- Money to cover the closing cost, i.e., around 2-6% of the purchase price.
How do I apply?
If you want to apply for the loan program you need to provide your income statement to the lenders. You will need to pay primary mortgage insurance (PMI) if your down payment is less than 20%. When you will reach 20% equity in your home, you can request to cancel the PMI.
We are here to make it easier for you and guide you starting from a 30-Year Fixed Rate Qualifier, where you can check for your qualification. We will guide you and provide all the details for choosing the right loan programs.