About 90% of home buyers choose a 30-year fixed-rate loan, making it the most popular mortgage type in the country. As its name suggests, the interest rate does not change over the course of 30 years. This means that borrowers can enjoy lower monthly payments because the mortgage is stretched over a long time.

 There are two types of interest rates – variable and fixed. With a variable interest rate home loan, your interest rate can rise or fall over the life of the loan. With a fixed rate loan, your interest rate will stay the same for an agreed time, usually between 1 and 5 years.

There are 3 levels of approval. A Pre-Approval can be obtained instantly but is not binding and should never to be used to make an offer on a property. Conditional Approval is where you complete an application form and submit all the supporting documentation to show that you can repay the loan. An assessment is made that you can repay the loan and approval is now only conditional on the property you wish to purchase. Conditional Approval normally takes 2-3 days. Full Approval is where both you and the property you are purchasing have been approved by the lender. You are now able to formally make an offer on the property or attend an auction. Full Approval normally takes 5-7 days on top of the conditional approval.

Normally there is no fee, however it is best for you to talk to your lender since some have different restrictions. Paying more toward your principal can reduce the interest you’ll pay over time. Additionally, every payment that goes toward your principal builds equity in your home, so you can build equity faster by making additional principal-only payments.

“Most borrowers can expect to close a mortgage in 20 to 30 days.” The time it takes to close a mortgage depends heavily on you to provide all the necessary documentation as soon as possible. The mortgage process itself — from application to final walkthrough and closing — generally takes between 20 to 30 days.

When you are applying for a home loan, here are the most needed documents for a lender to approve your loan.

1. We will need your personal information to run credit.

2. Tax returns, 2 years needed.

3. Pay stubs,

4. W-2s

5. Bank statements and other assets.

6. Photo ID.