Mortgage is nothing but a loan in lieu of real estate or property. In it one pledges his property and receive loan on behalf of it. It is generally required by most of the people planning to buy a home or commercial building for shelter or business purposes. In it the financial institution or banks gives the loan to the borrower and the borrower in return pledges the property. The amortization period i.e. the term of loan is variable but generally varies from 20- 30 years.  When you will apply for loan the monthly expenses will shoot up. Along with monthly repayment of loan the additional expenses include the maintenance of house. Electricity bills, house insurance, house taxes etc. are the other factors to be taken care of. After calculating all the expenses the affordability of the mortgage loan should be estimated. He should prepare his mind for cost cutting in various fields like vacations abroad, shopping for lifestyle i.e. going in mall and shop anything and everything, buying a new car etc. but there are certain other expenses which cannot be avoided like children’s school and college fee etc. while considering his present expenses one should also consider his future expenses. As many unpredicted expenses will come your way and you should be prepared to face them. You should start collecting money for your dream house as you think of buying a home for you. It is not a one day project so take time to work upon your decision to buy a house. Clear your debts if any. Pay off your credit card bills with higher rate of interests and close credit cards which are not in use. By this way try to save as much money as possible for the down payment of your mortgage loan. Paying at least 20 % of the down payment will not only lessen the loan amount and hence the interest paid to the bank but also saves the lender from PMI (private mortgaging insurance) which is charged in case the borrowers do not pay the initial down payment of 20%. If one can not afford the down payment of 20% of the mortgage loan at this stage,  than he should opt for “piggy-back” loan. In it two lenders take part in the loan here you finance 80% as your mortgage loan , 15% as home equity loan and just 5% as your down payment. The mortgage loans are repaid with additional rate of interest on the principal amount. This rate of interest levied on the principal amount can be fixed or variable (flexible/ adjustable). As the name suggest the fixed rate on interest is independent of market fluctuation and is same through out the amortization period where as the variable type of rate of interest varies with the market as proves sometimes profitable and cause loss other times. It is helpful if the loan is received for short duration of time because the mortgage loans are received for 20-30 yrs duration the market condition is unpredictable so it is better to stay on safer side and opt for fixed type of interest rates.

Take the decision of receiving land mortgage wisely as it involves a long term commitment with the lender and also involves huge amount of your hard earned money.