Just 12 miles southeast of Los Angeles, Whittier, California is far enough away from the fast-paced lifestyle of Hollywood, but close enough to enjoy the benefits at your leisure. And thanks to a large number of films and TV shows being filmed in and around Whittier, the local economy always has a huge influx of income.
So now that you’ve decided to move to Whittier, what do you need first? Well, a house of course. What follows is a quick lesson in mortgages, refinancing and home equity loans that new and old Whittierites will find useful.
Pre-Approval
Pre-approval is usually the way to go when buying a new home for two reasons: 1) Pre-approval allows you the extra time to narrow down your search for a new home by putting a spending cap on what you can spend. 2) Pre-approval allows the seller the piece of mind that when you put in a bid, you’ve got the financing to back it up.
What Type of Loan is Best For You?
Now you need to know what kind of loan is best for you. Of all of the loans available, for the purposes of getting started in the homebuying process, you really only need to be familiar with two: the fixed rate mortgage and the adjustable rate mortgage.
Fixed Rate Mortgage
Fixed rate mortgages are very popular because, although the initial interest rate is sometimes higher than most homebuyers would prefer, the rate is fixed throughout the life of the loan. This type of loan is popular with consumers who want to know exactly what their monthly payment is going to be with no surprises.
Adjustable Rate Mortgage
The second type of loan, the adjustable rate mortgage, is also popular. With this type of loan, the payment in the first few years is relatively low. But after that, the rate is subject to several factors: your lender’s index, the market fluctuations, and the caps set by your lender. This type of loan is usually preferred by the homebuyer who doesn’t plan on spending the next 30 years in the same house. Since in the beginning your payments are low, you can get out before the payment climbs to something you can’t afford.
OTHER TYPES OF LOANS
Mortgage Refinance Loans
If you are already a resident of Whittier and have no interest in buying a new house, you may have an interest in improving your existing situation. For example, maybe you are tired of paying $1,000 a month towards your house payment. Maybe you’d like to lower that to $750 a month and use the remaining $250 for something else. Then a mortgage refinance loan is the option for you. With a mortgage refinance loan, you’ll have to choose a new loan, a new rate, and a new term (10-year note, 15-year note, 30-year note, etc…). You’ll also have to decide whether you want to cash out the existing equity you’ve built up in the house. You may need this cash at your new closing. But if you don’t, keep the equity in your home, it’s safer there.
Home Equity Loan
A home equity loan is also another option. With this loan, you can pay off old debt, finally go on that long overdue vacation or even buy a new car. You can take out a loan using the existing equity in your home as collateral. You choose whether to take out the money in one lump sum (which would mean you would pay interest on the entire loan from the beginning), or you could choose a home equity line of credit. With a line of credit, you can borrow the money as you need it and only pay interest on the amount you’ve borrowed. This option is especially appealing for those homeowners who are using the home equity loan for things like a home remodel or paying for college.
Whether you’re looking for a Whittier mortgage, refinance, or home equity loan, we can help. Take a moment to fill out the form below, and a qualified lender will contact you right away.
