When you shop around for a loan, you may encounter the term APR or annual percentage rate. Some people think that interest rates and APRs are the same, but in reality, there are subtle differences between the two.

This article will explain what an APR is and how it's calculated and applied when deciding which loan is best for your goals.

What is APR?

Homebuyers usually look at interest rates attached to loans and pick the ones with the lowest rates. However, the lowest rate doesn't always mean it's the most affordable loan. Relying solely on interest rates to determine affordability ignores other factors like fees attached to the mortgage.

However, when looking at the annual percentage rate, you'll have a more precise and complete

Have you been asked to cosign by someone looking to get a home loan approval? You may be wondering why they would ask or how this affects you. This article will help you to understand both of these points. 

Why Were You Asked To Cosign? 

These are the top reasons that home loan applicants seek a co-borrower:

• Income: People may ask for a cosigner to include more income on their mortgage application. Higher income on the application can make it easier to get approved or borrow more from the lender.
• Credit score: Having someone with a higher credit score may help to secure a lower rate. 
• Employment: Little or poor employment history can prevent mortgage approval. Having a cosigner with better employment history can aid in getting

Ever wonder why it's essential to keep your debt in check when applying for a mortgage or what debt matters to your approval? This article will help you answer these fundamental questions so that you're in a great position to get approved for a home loan.

All About Debt-To-Income Ratio (DTI)

Your debt-to-income ratio (DTI) is one of the most critical metrics lenders use to determine how much home you afford because it directly influences the monthly payment you can qualify for.

DTI is a ratio that compares your existing monthly payments with your gross monthly income before taxes. Depending on the mortgage program and your qualification metrics, two types of calculations are used in mortgage qualification: 

• Front-end DTI -looks at the

One of the perks of a mortgage is the "mortgage interest deduction." Read on to learn what a mortgage deduction is, how much you can reduce from your taxable income, and how you can take advantage of this tax incentive.

About Mortgage Interest Deduction

The mortgage interest deduction is part of your itemized tax deductions, and it subtracts any interest you've paid on loans used to build, purchase or renovate a property. This means that you can subtract a portion of the mortgage interest for primary and secondary homes every year when you do your taxes. This, in turn, reduces the amount you owe Uncle Sam. 

To be clear, this perk does not include payments you've made to your homeowner's and private mortgage insurance (PMI). Here's a list of

An interest-only mortgage starts with payments that only pay down the mortgage interest. Generally, this makes your monthly payments lower than a typical mortgage payment. This option is attractive for those who cannot afford high mortgage payments. However, it has its drawbacks if you're not careful. Let's explore the benefits and disadvantages of interest-only mortgages. 

Benefits

• Interest-only loans give you time to increase your income. Are you expecting an income increase in the next few years? Then an interest-only loan can be advantageous. For example, let's say you're in a lower management position right now but on track for a promotion in the next year or so. Once you move up, your earning power will also increase. An

Renovations make your home more enjoyable. Plus, if you do them right, they may even increase your home's value. This comes in handy if you plan on selling your home in the future. But watch out! While some remodeling projects add value to your home, others do little to increase it and may even make your home less desirable to potential homebuyers.

Find out which renovations are the best and which are the worst.

Remember that Legacy Home Loans can help you get the funds to finance home renovations. With options like cash-out refinancing, FHA 203(k) rehab loan, a home equity loan, and HELOC, they can match you with a low-rate home loan to fund all your home repairs and upgrades. 

Best Home Projects to Boost Your Home’s Resale Value

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While the housing market remains vibrant for buying and selling, the supply continues to be an issue in these past years.

Low supply happens when there's an abundance of buyers but not enough houses for all of them. Many call it a "seller's market," which often results in a bidding war as multiple buyers compete for the same property. Here is how you can still get your dream home despite high competition. 

The Anatomy of a Bidding War

A bidding war in real estate happens when two or more parties compete for the seller's acceptance of their offer. This stressful situation can be intensified if the owner or listing agent knows there's a lot of interest and propose that everyone submit another higher and better offer.

Thus, you have now

There are many common mistakes first-time homebuyers make. Some are minor, while others can end up being costly. Fortunately, several of these mistakes are avoidable! Please read and share this article with other first-time homebuyers to help them spot these common errors before making them.

Mistake #1: Looking For A Home Before Getting Pre-Approved

When you shop for a home before approval, you run the risk of falling in love with a home that's out of your price range --ruining the whole home buying experience before you start.

Instead, focus on the finances first. Make sure you have enough saved for a down payment and the closing costs and get your pre-approval before you start home shopping.

Mistake #2: Buying More Than You Can

An origination fee is part of the multi-step process of getting a loan and includes the cost of processing the application, underwriting, and financing the loan. The lender may combine the fees into one charge or may list each one individually.  

Either way, origination fees are separate from your mortgage down payment and are often paid as part of your closing costs.

What Do Origination Fees Cover?

• Loan processing, such as reviewing your application and preparing documents.
• Underwriting, such as gathering and verifying your information, including your credit score.
• Loan Funding, such as "points" that lower your interest rate
  

How To Determine the Cost of Your Mortgage Origination Fee

The typical origination fee is

Thinking about buying a first home or a second? You have many loan options, and each one varies as far as their down payment requirements. Use this quick guide to get an idea of the amount you'll need to put down on your next purchase.

Is 20% Down Always Necessary to Buy a Home?

The down payment refers to the monies you'll put down during the mortgage closing, and it's often expressed as a percentage of the property price. For example, 20% down on a $200,000 home means paying $40,000 at closing.

20% down can make homeownership feel too out of reach. But take heart, very few loan programs are firm about needing 20% at closing. You can even get a conventional mortgage with as little as 3% down! Read on to learn more.

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