You can have the time of your life buying a new home. You can look for the perfect home, and find the one that is just right for you. However, in order to finance the purchase, you will probably need to obtain a mortgage. The mortgage loan process can be very scary and intimidating. You want to make sure you meet the requirements, and you want to make sure you have the paperwork necessary for a loan. Many people in the state of Utah need a mortgage to buy a new home. Utah is located in the western portion of the country and is known for its vast deserts. Salt Lake City is the capital and largest city in the state. If you live in Utah and need a mortgage, research the facts about a loan, so you will know what to expect.
Mortgage Rates in Utah
http://www.bankrate.com/utah/mortgage-rates.aspx states that the average interest rate for a 30-year fixed rate mortgage stands at 4.22%. For a 15-year fixed rate mortgage, the rate will be 3.35%. For an adjustable rate mortgage, the rate for a 5/1 ARM is 3.44%, and for a refinance loan, the rate will be 4.26% for a 30-year loan and 3.40% for a 15-year refinance. The 30-year loan is the most popular; however, you can get a lower rate if you choose the 15-year mortgage. Rates will vary among lenders, so make sure you compare lenders.
Applying for a Mortgage in Utah
You need to pull your credit report and check your credit score before you apply for a mortgage. You will get a better rate if you have good credit. You need to search online for the best lenders available. You want a lender that offers excellent customer service and flexible terms. You also need to compare rates. Most lenders will allow you to gain pre-approval for a loan, so you will know how much you can afford. Lenders will want you to submit certain documents, such as W2 forms, bank statements, pay stubs, and federal income returns. An appraisal of your home will be ordered, as well as an inspection. The entire process usually takes up to six weeks, and then you can close on the loan.
Mortgage Laws in Utah
The law in Utah requires lenders to be honest and upfront regarding mortgages. Lenders must present you with both a Good Faith Estimate and a Truth in Lending Disclosure. These documents must tell you about the total cost of the loan, number of payments, amount financed, and annual percentage rate. The papers will also inform you exactly what you will be paying in closing costs. Lenders cannot give your personal information to any other party, and they cannot discriminate against you. If you default on your loan, the lender can foreclose on your home. They can seize your home after you default on the payments for more than 120 days.
Types of Loans in Utah
- Fixed rate loans: The rate will stay constant throughout the entire life of the loan.
- Adjustable rate loans: Your rate could go up or down, and your monthly payment amount will change.
- FHA loans: Insured by the federal government, you can obtain these loans with a lower credit score and a minimum down payment.
- VA loans: Insured by the federal government, you must be in the military or retired military to apply for this type of loan. No down payment is required.
- USDA loan: If you do not have a higher income, this is a good loan for you.
- Conventional loan: This loan is not insured by the federal government.
After you complete your loan, you can relax and enjoy all of the privileges that come with home ownership. You can then be confident that your lender will act in your best interest and offer you an excellent lending experience.