<#-- Rebranding: Header Logo--> <#-- Rebranding: Footer Logo-->
  1. Mortgage Basics: Introduction
  2. Mortgage Basics: Fixed-Rate Mortgages
  3. Mortgage Basics: Variable-Rate Mortgages
  4. Mortgage Basics: Costs
  5. Mortgage Basics: The Amortization Schedule
  6. Mortgage Basics: Loan Eligibility
  7. Mortgage Basics: The Big Picture
  8. Mortgage Basics: How To Get A Mortgage
  9. Mortgage Basics: Conclusion

By Lisa Smith

A home of your own. That little phrase captures so much emotion, and so many hopes and dreams. It's a place to express yourself and somewhere you can do what you want, when you want. You can decorate, landscape and shape your surroundings with no limits other than your imagination and your budget. Quite simply, for many people, homeownership represents freedom.

Owning a home is also an opportunity to put down roots and get involved in the community. Buying a home is your chance to leave behind the transient lifestyle and rent increases of the apartment dweller, exchanging something temporary that belongs to someone else for something permanent that belongs to you. It's a powerful emotional pull that encourages millions of people to make the move from renting to buying. (For more on this, read To Rent Or Buy? The Financial Issues - Part 1 and Part 2.)

Beyond all of the emotion invested in homeownership, owning a home can also be a powerful financial tool. Even if you don't have enough money left at the end of the month to invest in traditional wealth-building vehicles like stocks and bonds, simply paying for the place where you live can help you amass a substantial net worth. In fact, used properly, homeownership is often an individual's single largest source of wealth. Money paid into a house and not taken back out generally continues to grow over time as the value of the property appreciates. It is possible that in 30 years, that $100,000 house may be worth double or triple what you paid for it.

While buying home can give you a great place to live and a way to build wealth, all of these hopes, dreams and financial benefits come with a cost. For most people, the bulk of that cost is wrapped up in a mortgage.

So what is a mortgage? If you take a look at the mortgage calculator below, you'll see examples of lenders and the various types of mortgages. However, at its most basic, a mortgage is a loan used to purchase a house.

 

This definition is simple enough to capture the essence of the issue, but it barely scratches the surface of the complex issues that underlie this topic.
In this tutorial, we'll provide the foundation you need to research and find a mortgage. We'll start by explaining the basic types of popular mortgages available in the marketplace, and then we'll review the costs associated with a mortgage and the process that you must go through in order to secure one. We'll also review the pros and cons of homeownership and highlight some tips for positioning your finances in a way that will help you qualify for a favorable interest rate such as using a mortgage calculator like the one above. (For a one-stop shop on subprime mortgages and the subprime meltdown, check out the Subprime Mortgages Feature.)
 


Mortgage Basics: Fixed-Rate Mortgages
Related Articles
  1. IPF - Mortgage

    Finding the Best Mortgage Rates

    As home-buying technology has progressed, the process of finding the best mortgages rates can all be done online. Here's how.
  2. Investing

    Why You Shouldn't Pay Off Your Mortgage

    With today's historically low interest rates, it may make more sense to keep your 30-year mortgage.
  3. IPF - Mortgage

    Mortgage Calculator

    Calculate monthly mortgage payments with our free mortgage calculator. Avoid costly mistakes and make the right financial decision when buying a house.
  4. Personal Finance

    The Benefits of Mortgage Repayment

    Buying a home may be the biggest debt you'll ever incur. Learn the benefits to having a mortgage repayment plan and find out the pros, the cons, and why you should retire it sooner, rather than ...
  5. IPF - Mortgage

    7 Sneaky Low-Rate Mortgage Tricks

    Interest rates on a mortgage aren't the only factor defining a good loan.
  6. Personal Finance

    Benefits Of Paying Off Your Mortgage

    Paying off your mortgage in a reasonable amount of time can result in financial security and freedom.
  7. Personal Finance

    The Pros and Cons of Paying Off a Mortgage

    Deciding whether or not it's a good idea to pay off your mortgage depends on several factors.
  8. Personal Finance

    Does A Mortgage Make Sense If You're In Your 20s?

    You're probably moving a lot and still paying off your student loans. Is it crazy to get a mortgage in your 20s? Here's how to decide.
  9. IPF - Mortgage

    Mortgage Points: What's the Point?

    Do you want to buy a house or apartment with lower up-front costs? Learn how mortgage points can help you pay less for your home.
  10. IPF - Mortgage

    Mortgage Guide

    Have you finally reached that time in life where you’re ready to buy a home? Luckily for you, we have put together all the information you will need to get the right mortgage and the right lender, ...
Trading Center