American Midwest Mortgage Corp.

I really want to own my own home, but I´m not sure I can afford it. Where do I start?
Lots of people don´t even consider buying a home because they´re afraid they can´t afford it. But for most people, home ownership is within reach - especially with some of the special programs American Midwest Mortgage has for first-time home buyers. In fact, for many, home ownership is as affordable as renting - in some cases even more affordable.

The best place to start is with a mortgage lender affiliated with the Mortgage Bankers Association of America; a lender can help you explore all the options of home ownership.

How do I know how much I can afford?
Before you start looking at homes, you need to have some idea of what you can afford. As a general guide, you can purchase a home with a value of two to three times your annual household income, depending on your savings and debts. However, you may be able to take advantage of special loan programs for first time buyers to purchase a home with a higher value.

If you´d like to know exactly how much you can afford, talk to Dolores Walter at American Midwest Mortgage Co.

When should I talk to a mortgage banker?
Any reputable mortgage lender will be happy to help you as you look for a home. The lender will work with you to determine how much house you can afford, help steer you to special mortgages for first time home buyers, and perhaps make suggestions that could make it easier to get the best mortgage for you.

Aren´t there really just two kinds of mortgages: fixed and adjustable rate?
You could say that, because all mortgages fall into one of these two categories - that is, the interest rate you pay is either the same (fixed) for the life of the mortgage, or it can change (adjust) over the life of the mortgage.

But within these two broad categories, there are many different kinds of mortgages, designed to fit people in different financial situations - and many of them are especially for first time home buyers.

There isn´t a single, simple answer to this question. The right type of mortgage for you depends on many different factors:Your current financial picture:

How you expect your finances to change;
How long do you intend to keep your house;
And how comfortable you are with mortgage payment changing from time to time.

For example, a 15-year fixed rate mortgage can save you many thousands of dollars in interest payments over the life of the loan, but your monthly payments will be higher. And an adjustable rate mortgage may get you started with a lower monthly payment than a fixed-rate mortgage - but your payments could get higher when the interest rate changes.

The best way to find the right answer is to discuss your finances, your plans and financial prospects, and your preferences frankly with a mortgage lender.

What does my mortgage payment include?
For most homeowners, the monthly mortgage payments include three separate parts: a payment on the principal of the loan (that is, the amount borrowed); a payment on the interest; and payments into a special account (called an escrow account) that your lender maintains to pay for things like your hazard insurance and property taxes. These elements are called P.I.T.I. (Principal-Interest-Taxes-Insurance).