When many people hear the word ‘mortgage’, they often think of debt.  A mortgage is usually an amount of money that someone borrows from someone else to purchase some sort of real estate, whether it be a house, condo, a lot or land. 

That real estate purchased with the monies that was lent to the borrower, is then the property of the lender if the loan was ever to go into default.  Being financed through a financial institution is how nearly all first time home owners purchase their first home.

Before purchasing some kind of property, it always requires in depth research into how to get the best rates, the perfect property for you and of course, finding a lender you want to work with. 

The first step is to get access to real estate listings.  This is how you can find out what is available and the basic information for that property. 

Purchasing for a house would include information regarding its square footage (size of the house), the number of rooms, bathrooms and any other mentionable features of the house, the acreage, its location and of course, the price. 

Once finding the perfect home for you, you need to have a down payment.  You take the price of the house and minus the down payment, and the rest is then financed through the lender that is going to finance you. You want to be able to afford your monthly payments, so you want to find access to a mortgage calculator. 

You can find plenty of these online or ask your real estate agent.  You will be offered a rate to which your loan which accrue interest upon.  You enter into the calculator, the price of the house, your down payment, the interest rates that were offered to you and the amount of years you want to take to pay off your house. 

This will give you a monthly payment.  Usually, the longest period of time a lender will allow is 30 years. There are two kinds of interest rates that can be offered to home buyers. 

A fixed rate and a variable rate.  The fixed rate remains the same throughout the whole loan period despite the changes to the prime rate over the years. 

The variable rate is dependant upon the prime rate.  The lender may add their own interest on top of the prime rate.  As the prime rate fluctuates over the years, so will your payments. 

There are options available to keep the payment the same with a variable rate but the loan period will lengthen.  This is just some basic information for those of you considering to purchase a home.