Buying the first home is not just a very exciting experience but it is undoubtedly the most challenging experience. Now, what is the biggest challenge when you are planning to buy your first house? It is choosing the right mortgage for yourself. Well, there are so many mortgages available in the market. These days the lenders have all the specifications mentioned in their offers and so there is hardly anything that you will not know before you make the decision to choose the best mortgage for yourself. Yes, you will have to do some comparisons before coming to a conclusion. One thing that you must never let skip out of your mind is the practical financial target that you have in mind. All the lenders will do the calculation based on your income, your expenses, your savings, your records, the current interest rates and the possible fluctuations of the rates in the future. Of course, these factors are taken into account roughly.
Be informed that 100% mortgages are not available these days. So that means, you will have to make an initial deposit of the total mortgage amount decided and the remaining amount will be financed by the lender. A bigger initial deposit will fetch you more benefits.
There are different types of mortgages but broadly they are categorized as Variable Rate Mortgage and Fixed Rate Mortgage. You will have to choose between the two and one thing that should be clear in your mind before you make the choice is the time span for which you want to keep the mortgage. The main reason that you have to be mindful about the time span is because early surrendering or repayment of the mortgage amount will let you be penalized by the lender.