Page 4 Fall Home Improvement 2025 Lincoln Daily News Continue -- Are you currently looking to buy a house? Fall can be a great season to move. Once winter hits, the cold and ice can make moving conditions not only unfavorable but potentially dangerous. During the hotter months of summer, moving can be just as unbearable due to the heat. The mild temperatures of fall can make moving in this season a better choice. Talking about moving is the easy part. The hard part of moving can be understanding all the financial ins and outs. What exactly is a mortgage? How do you know if you have enough money for a house? What should your price range be? What is a good interest rate versus a bad one? Keep reading to get the answers to all these questions. A mortgage is a loan taken out from a financial institution such as a bank. These loans tend to have a term, or a period of time to be paid back, of 15 or 30 years. There can be other terms depending on your financial situation. This is where interest rates come into play as banks are not going to simply give out money and hope you pay them back as much as you borrowed. According to Investopedia, “the interest rate is the percentage of interest relative to the principal.” If you are not versed in words like ‘interest’ and ‘principal,’ then this definition may not mean much. Looking to Buy a House? Simply put, interest is the fee you pay to a financial institution for borrowing their money to make a purchase such as a house. Principal is even easier to understand, with that number being the amount of money you have left to pay back on your loan. Together these can be used to figure out your loan’s APR (annual percentage rate), which is a specific type of interest. For example, if the APR of your mortgage is 6 percent and the mortgage itself is $150,000 then you would pay a fee of 6 percent of that $150,000 each year for borrowing that amount. In this case, that amount would be $9,000 per year, or about $750 per month. It is also important to know that this amount may change as you pay down the principal of your loan. What about knowing your price range? The answer to this question is not as cut and dry as the answer to the previous two questions. According to Associated Bank’s website, higher interest rates can make both finding a house and affording a house more difficult. Associated Bank states “as interest rates rise, monthly mortgage payments increase, reducing the amount of home you can afford.” Later in the same article, it is stated that “rising interest rates tend to cool down the
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