OnPath Credit Union

A mortgage is simply a type of loan to help you cover the cost of the home you're buying. You can apply for one through a lender, like a credit union. The most common mortgage loans for first-time homebuyers are ones insured by the Federal Housing Administration (FHA). Typically, first timers get a 30-year term with a fixed interest rate. That means you'll make fixed monthly payments for the next 30 years until your loan is paid off.

There are other types of loans for first-time homebuyers, such as VA loans and USDA loans. In addition, instead of a fixed annual percentage rate, you can opt for an adjustable rate. And instead of a 30-year term, you can select a shorter one, such as 15 years.

Here are some other common mortgage terms you’re likely come across:

• Mortgage Insurance: In some cases, you may be required to get private mortgage insurance (PMI).
• Debt-to-Income Ratio: This is a calculation of all your debts compared to your income. It helps lenders determine whether you're a good candidate for a mortgage loan. Pay off your debts, maintain a steady job and keep your credit score high to put yourself in a better position.
• Closing Costs: While closing on the deal, the buyer usually has to pay for some of the services and expenses accrued from the mortgage process. This may include fees for the appraisal, home inspection, attorneys and more.
  First-time home buyers have more options available to them. For instance, there are state and local assistance programs to help you pay for things like closing costs and the down payment. The bigger the down payment you put down, the better. It means your monthly mortgage payments will be lower. In addition, you can also dip into your 401(k) plan and put those funds towards your mortgage. Your first mortgage is the only time you can do that.

Work With a Lender You Trust

If you're at the stage where you're looking for a lender for a first-time home buyer mortgage, look into OnPath Federal Credit Union. We're committed to taking care of our members through all of life's ups and downs, home ownership included. Our lending officers can be by your side and guide you through the process, from start to finish.

To learn more, contact OnPath Federal Credit Union today. Or, sign up to attend our First-Time Homebuyer Workshop for a more in-depth look at what to expect. We also have education resources online.