Even though lending standards have tightened since the mortgage crisis, you still have some flexibility in how large your down payment will be when buying a home.

How much you put down will affect the type of mortgage you can qualify for, the interest rate you can get, how much you can borrow, whether you’ll pay private mortgage insurance and more.

Perhaps the biggest difference between the bubble years and the present is that the only way to purchase a home with nothing down today is through a Department of Veterans Affairs mortgage. (more…)

For most people, buying a home means borrowing money, and borrowing money means paying interest.

But the way you pay interest and principal on a home loan is unlike the way you pay interest on some of the loans you may be more familiar with, like the money you borrowed on your credit card.

Credit cards offer revolving loans with no fixed payoff date. With a mortgage, you get a fixed loan meant to to paid off by a certain date, typically in equal monthly installments.

The schedule of your monthly payments is called an amortization schedule. (more…)

When you apply for a mortgage, the lender will use a couple of calculations to determine how much you can afford to spend on a home.

The first calculation takes your proposed monthly mortgage payment, including property taxes, insurance, and mortgage insurance (if applicable) and divides this total debt amount by your gross monthly income.

In other words, it looks at whether you can afford your mortgage given your income. (more…)

When you’re thinking about listing your house for sale, it’s important to understand how much money you’ll walk away with after the transaction is complete.

After the sales price and your remaining loan balance, closing costs are the biggest factor that will affect your profit or loss on the sale of your home.

For most sellers, the biggest closing cost is the real estate agent’s commission.

The traditional commission is 6% of the home’s sales price, and of this 6%, 3% will go to the buyer’s agent and 3% will go to the seller’s agent. (more…)

If you don’t buy homeowners insurance, your lender will — at a big price.

Force placed insurance, also called lender placed insurance, is pretty much what it sounds like: it’s a hazard or flood insurance policy that your lender acquires on your behalf and forces you to pay for.

If you don’t take out a policy yourself, don’t pay your premiums or don’t have adequate coverage for any type of home insurance your lender requires, it can force coverage. (more…)