skip to main content

NLNB Blog

Common Mortgage Loan Myths

Congratulations! You’re finally settling down and looking into purchasing your very first home. Going from renting to buying a home is a huge step, but equipped with the right knowledge from the friendly team at NebraskaLand National Bank, you’ll be able to make confident, informed decisions about your mortgage loan. Your first home is a serious and major purchase, and so we also treat Nebraska mortgage loans seriously.

Our Experienced Lenders Can Help You With Your Mortgage
From one first-time home buyer to another, you can probably imagine that there’s some confusion and misunderstanding when it comes to a bank mortgage. That’s why our community banks in Kearney and North Platte are going to address some myths about mortgage loans that many first-time home buyers tend to ‘buy into’. You can learn more about our mortgage and consumer loans by visiting here, but read on to discover some surprising things about mortgage loans that you may not have known about before.

Myth: It’s Always Cheaper To Rent Than Buy A Home
While renting is convenient because there’s no long-term commitment to live in your property beyond the timeframe of the lease, it’s going to be more expensive in the long run as compared to buying a home. The fact is that it’s almost always less expensive to pay a mortgage than to rent a comparable home. When you rent, the landlord, real estate company or apartment complex are responsible for doing maintenance.

This maintenance convenience is, of course, baked into the price that you pay each month for rent. As a homeowner, yes, these expenses are your responsibility, but if you are adequately prepared for them, it will almost always cost less than the premium you will pay monthly to rent. Plus, another perk of owning a home is that it gives you the opportunity to build equity - when the lease is up on your rented property, you are free to leave, but the money you paid throughout the lease term is gone.

Myth: You Should Always Pay Off Your Mortgage ASAP
Logically, it makes sense that you should pay off your entire mortgage as quickly as possible, but depending on the case, this may not be the best use of your money. Yes, paying down your mortgage may lower your principal, but it’s not the same as instant equity. When you pay your mortgage, the only guarantee is that you are lowering your overall loan balance.

So, rather than paying more into your mortgage each month in order to pay it off sooner, consider investing that extra money. It’s also important to keep in mind that the interest you earn on these type of investments may actually be higher than the interest you pay on your mortgage itself. Another thing to remember is that the interest you pay on your mortgage may be deductible at tax time.

Myth: You Must Have Perfect Credit To Get A Mortgage
In reality, credit scores range anywhere from 300 to 850. Lenders consider additional factors when reviewing mortgage applications, and if they are satisfied with your overall financial situation, you may still qualify for a loan. Just make sure that you provide accurate information on your application and keep working to improve your credit score since a higher score can help you get a lower interest rate on your loan.

NebraskaLand Is Your Key To Your Home
Everyone deserves a nice home that works for them, and our friendly and community-minded lenders can leverage their 30 years of experience to get you mortgage financing that works for you. If you’re a first-time home buyer who’s looking into buying a home, contact NebraskaLand today for Nebraska home loans!

Theme picker

Local People. Local Decisions. Local Ownership.
NebraskaLand National Bank is committed to website compliance with the Americans with Disabilities Act.
We strive to make our site useful and accessible to everyone. If you have questions or comments regarding the website please contact us.
copyright © 2004-2020 NebraskaLand National Bank. All rights reserved. / sitemap / Admin Login
top
^