A dream is realized when you purchase a home. However, when you start out to acquire a home you need to ensure that the mortgage is sufficient to buy the house and that after payment of mortgage there is enough money to have a decent life.

A nightmare no one should have is a mortgage that leaves you destitute. So, at the very start make a list of expenses and include apart from living expenses unforeseen expenses of house or car repairs, sickness, insurance payments, bank charges, and so on. Take a close look at your monthly earnings, savings, and the security of your job. It would be disastrous if you commit to mortgage payments but have no job that generates a regular income. The most important factors to consider while applying for a mortgage are the DTI or debt to income ratio and credit score which states your credit worthiness and is computed by considering income, payment history, credit history, and types of credit used.

Study the market and go online and determine what the different kinds of mortgage rates are and which one is best for you. The general categories are: fixed rate where the loan will have a fixed interest rate for the life of the loan, typically 30, 20, 15, or10 years; adjustable rate where the rate will fluctuate and is dependent on market trends; balloon mortgage where the rate of interest is lower than conventional 30 year mortgages but the amount should be paid up in 30 years. Weigh carefully the pros and cons of each kind before choosing one.

Experts in finance recommend that you must make use of bank advisory services or online tools that will not just educate you about mortgage loan rates but will explain the key features of loans and help you work out what is best for you. Sites like e-loan, quickenmortgage.com, bankrate.com, interest.com, or e-mortgageloanrate.com are invaluable sources of information.