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 Successfully getting a first time home buyer loan
  Are bi-weekly mortgage payment plans necessary?
By the EchoBay Loans Expert
 Successfully getting a first time home buyer loan
Dear EchoBay Expert: What's the best tips or information you could give for someone preparing to get a first time home buyer loan?

Dear Loyal Reader: Your first home purchase will be exciting, but entering into it unprepared can make it nerve-wracking as well. The best advice I could offer would be research, research, and then research some more. Research as much information as you possibly can.

Knowledge is power, and you're going to need it if you want to avoid the most common first time home buyer loan mistakes. Make sure that you understand the difference between fixed-rate mortgages and adjustable-rate mortgages, what different mortgage programs are available to you along with the pros and cons of each, and what you should expect when the mortgage process begins.

You'll also want to understand the difference between the various lender types, where to go for the best mortgage rates, and how much you'll need to bring to the closing table. EchoBay Loans has a vast number of informative articles available for your research needs that cover all of these topics and more. Taking the time to review them can save you a lot of headaches, not to mention money, in the long run.

 Are bi-weekly mortgage payment plans necessary?
Dear EchoBay Expert: My mortgage broker is trying to convince me to change my home loan to a biweekly mortgage payment plan. Are there any benefits to it and should I do it?

Dear Loyal Reader: You can payoff your loan faster with a biweekly mortgage payment plan and save yourself thousands of dollars in interest over the life of your loan. However, you can also easily do this yourself without having to pay someone else to "manage" it for you.

You can have the same effect on your mortgage by making an extra payment each year or by paying a little extra each month towards principal. Let's assume you have a $100,000 mortgage at 6% resulting in payments of $599.55. Divide your payment by 12 for approximately $50.

Adding $50 to your payment each month is the same effect as making an extra payment each year. If you do this each month, you will pay off your mortgage in 24 years and 7 months instead of thirty years and save more than $24,569 in interest.

While many brokers will set this up for you for a fee, you can see that you can easily do this on your own for free. When you send in your payment, you may want to attach a note stating that you would like the extra to be applied directly to principal. It's as easy as that!

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