● Secure Your Credit- Approximately three months prior to obtaining a mortgage, you should consider securing your credit in order to ensure loan approval. There are several ways you can secure your credit, such as paying off credit cards, paying monthly bills on time, and ensuring there exist no inaccuracies on your credit report.  

● Prepare Your Documentation- If you would like to experience an easier and quicker loan application process, it is important to have the proper documents ready.  Most home loans require a person to have a full month's paycheck stubs, the past two year's tax returns, and three consecutive bank statements. The numerical requirements can fluctuate depending on the home loan for which you are applying.    

● Review Your Loan Options- Before you decide on just one loan program, it is important to review your loan options, such as a fixed rate interest loan, a variable rate interest loan, a low or no down payment loan program.  Depending upon your financial situation, the current market, and future expectations, the loans offer different advantages.   Your mortgage consultant can help you decide which loan is best for you.

● Discuss Negotiations- When you are purchasing a home, it is important to discuss certain negotiations with your real estate agent before you make an offer on the house. The negotiations may deal with closing costs, move in dates, inspection fees, loan approval dates, and other conditions that affect your decision to purchase the house.  Most sellers have negotiation room built into their price, and it does not hurt to initiate negotiations - you may end up saving thousands of dollars in the end.  

● Research Your Lending Options- Do your research before you commit to any one type of mortgage lender. It is important to know that there are many different lending sources out there. This includes mortgage brokers, credit unions, online lenders, and more. Make sure to compare a few to really find out the lender that suits you, your new home, and financial circumstances best.

● Consider the Length of the Loan- It is critical to evaluate the duration of the loan. There are numerous options open to home buyers, such as fifteen to twenty year terms, ten to twenty year loan amortizations, balloon payments, and thirty year loans. It is important to choose the mortgage that meets your unique financial needs.   Remember, although a monthly payment may look more attractive with a longer loan, you will be paying more in the long-run.    

● Consider a Fixed or Variable Interest Rate- When you are interested in obtaining a mortgage, it is important to consider the differences between a fixed or variable interest rate home loan.  There are several advantages and disadvantages to both of these loan types.  Your decision may ultimately depend on the market conditions at the time of your loan.

● Low Down Payment Loan- If you are interested in purchasing a home, but do not have a significant amount of savings, you may want to consider obtaining a low or no down payment home loan.  With this type of mortgage you are not required, in some cases, to put down any type of down payment on the home.   However, you should also evaluate your long term financial payout with this type of loan.   You may or may not be in a better financial situation to wait one year, save your money, and then proceed with a standard loan.    

● Use a Mortgage Calculator- When you are considering purchasing a home, a mortgage calculator is an effective tool to evaluate both your short-term and long-term mortgage costs.  A mortgage calculator can help you decide if home owning or renting is right for you, as well as help you ascertain the ideal mortgage payment amount for your income and budget.   Visit LendingTree.com to find an effective mortgage calculator that will help you find the best mortgage for your financial situation.

● Make Sure a Second Mortgage is Right For You- When considering refinancing, make sure that a second mortgage is the right loan for you. A second mortgage usually disburses the funds in one large lump sum and has fixed interest rates, but at the same time, you want to evaluate whether the market is in an ideal situation for you to be locked into a second mortgage.    

● Benefits of a Thirty Year Mortgage- A homebuyer should understand the benefits of the current thirty year mortgage rates.  The monthly payments will be lower than a 15 year loan, and as the interest rates are currently at an all time low, the 30 year mortgage may provide you with great short-term and long-term advantages.  

● Consider a Mortgage Broker- If you loan application was rejected by a bank, you may want to consider working with a mortgage broker. A mortgage broker could be your secret weapon to obtaining the funding needed to purchase your new home. A mortgage broker can be found online, or you can find various mortgage brokers in your local area.    

● Factor in Interest Rate Increases- When you are interested in purchasing a home, you should consider what interest rate hikes may do to your monthly mortgage payment. It is important to understand how mortgage rates are determined and how your personal finances could be affected when the market fluctuates, especially if you have a variable interest rate mortgage.  

● Beware of Mortgage Scams- First-time home buyers need to be careful of mortgage scams. A mortgage scam can end up costing a home buyer tens of thousands of dollars and result in a loss of the home. It is critical to be knowledgeable on the most common mortgage scams that are practiced today, as they specifically prey on the uninformed, weak, or financially desperate.  By researching on mortgage scam developments, you will ensure that you are not taken for a ride both financially and emotionally.

● Understand Your Mortgage Terms- When refinancing a home, you must understand your current and future mortgage details. This means that you must be aware of your credit history, mortgage goals, and your current home loan amount. This will allow you to make a decision on your home financing needs. If you have a home loan and want to refinance, you must be aware of the type of mortgage that you have.   Your existing home loan may have stringent fines that you will pay to terminate your loan, and this may weight out the benefits of refinancing.    

● Research Bad Credit Loans- If you have bad credit, you can still get a decent loan, despite your poor financial history.  Your credit score plays a very important role in being approved for a home loan. A lender will look closely into your credit history, bankruptcy and other financial factors.  However, there are several home loans available for people who suffer from bad credit or no credit.

● The Role of Shifts in Interest Rates- A shift in federal interest rates may play a significant role in your home loan options. An interest rate can determine the type of mortgage you can choose from, and if it is the right time to refinance your home loan. It is important to research what the current interest rate is on first and second home loans.   Also, by keeping abreast of the Fed announcements, you can stay one step ahead of the interest rate mortgage game.    

● Research the Market First- Before you purchase a home you should research what the market is experiencing.  If it is a buyer's market, then you will more than likely get more home for your money and have more leverage in negotiations.  Typically, the winter season is the most ideal season for a buyer to purchase homes, as this is the low season where demand decreases.   In addition, a first-time home buyer will have more mortgage options when it is a buyer's market.

● Protect Yourself From a Down Turn- The experts in the real estate industry caution that there may be a burst in the housing bubble sometime in the near future.  It is important, since you can not control home prices, to protect yourself from a potential down turn in the real estate market. You can meet with a mortgage consultant who can give you more advice on protecting you greatest asset.

● Understand Cash-Out Refinancing- If you are interested in refinancing, it is important to understand the concept of cash-out refinancing. Cash-out refinancing involves refinancing your current mortgage for an amount that is larger then you owe. This is great for homeowners who are hit hard with college expenses, wedding costs, credit card debt, and pricey home improvements.

● Going Green with Home Loans- One of the most obvious ways to save money on your home loan is by obtaining a low mortgage rate. A savvy homeowner can also take advantage of the financial benefits from the latest environmentally-friendly technology and energy-efficient products.   You can often get greater rebates and tax benefits by going green!  

● The Hybrid ARM- A first-time home buyer should be aware of a Hybrid ARM. This is a new type of home loan that allows you to secure a very low interest rate for a specific period of time. This may be for five, seven, or ten years. After the fixed period of time passes, your interest rate is subject to adjustments, depending on the fluctuations in the market.   Make sure you do your research and do not get lulled into fixed interest rate security when it will change down the road.  

● Important Tax Benefits of Owning a Home- When purchasing a home, it is important to factor in the tax benefits of homeownership. There are several tax advantages to owning your own home, such as the deductions for interest payments.  Purchasing a home is one of the biggest investments you will ever make, and the government utilizes several tax benefits to help you own the house of your dreams.  

● Determining if Homeownership Right for You- Before you obtain a mortgage and sign the paperwork, it is important to consider if homeownership is right for you. There are several personal and financial advantages to owning your own home, including building permanent assets and tax deductions.  However, if you financially cannot afford a mortgage, then owning a home will put undue burden upon you and your family.   It is important to consider all of these advantages and disadvantages before you apply for a mortgage. To help you make the decision, you can use a mortgage calculator to ascertain what you can truly afford.

● Plan Ahead for Your Mortgage Payment- When you are applying for a mortgage, it is important to figure out how much you can afford to pay monthly on your mortgage payment. A home buyer must consider the amount of the mortgage that they can afford and that best suits their financial needs. Before you apply for a mortgage, make sure to take into consideration you purchasing power.   Overstretching oneself financially is one of the biggest reasons people lose their homes to foreclosure.

● Figure Out Your Mortgage Budget- When deciding your mortgage budget, it is important to take into consideration your monthly household income, monthly debts, loan closing costs, down payment amount, and your credit history.  All of these factors play a role in the interest rate, finance fees, and mortgage payments you will incur.  

● A Pre-Qualifying Application Process- A first-time home buyer should go through a pre-qualifying application process. This will allow your real estate agent to focus on the specific homes that fit within your price range. When you are pre-qualified, you know the maximum loan amount for which you are approved, which can help you determine your budget.    

● Create a Home Wish List- Before you decide on one home and one mortgage, you should create a home wish list. This is a checklist that will help you to prioritize and identify the features that you want your new home to have, ensuring that you will be happy when escrow closes and the keys are in your possession.   In addition, by using this checklist, you can also organize the key people involved in the process of purchasing your new home.

● A Limited or Bad Credit Home Loan- When you are applying for a mortgage and you have a limited credit history or bad credit, you should have an individual already lined up to co-sign on the loan for you. Oftentimes, homebuyers that have limited or poor credit will need to have a co-signer on their home loan. If you already have someone willing to co-sign on your mortgage, this can help to speed up the process and provide you with a better mortgage deal.

● Choose a Lender You Are Comfortable with- One of the most important mortgage tips is to work with a lending institution with whom you feel comfortable.   You should feel comfortable with your lender, the type of mortgage you are seeking, and can imagine yourself having a long-term relationship with the institution.  Remember, you may have a thirty year relationship with your lender. It is important to have a firm foundation based on trust.

● Research Early Payoff Penalties and Other Fees- Lastly, before you decide and sign the papers on your mortgage, double check to see what the fees are and if there is an early payoff penalty.  Some loans also have very cost-prohibitive fines for loan termination if you are looking to refinance.   Once you sign the paperwork, it is too late to change any of the terms, but if you take time to review the fine print, you can negotiate a better mortgage deal for yourself.