Many consumers lack mortgage knowledge

Many prospective buyers aren't sure what many mortgage terms mean.While low mortgage rates have made Houston homes much more affordable in recent months, a report from Seattle-based Zillow finds many people looking to buy a home don't understand many basic mortgage questions.According to Zillow, 46 percent of homebuyers who took a quiz about several aspects of getting a home loan weren't able to answer the questions correctly. In addition, 44 percent also said they didn't feel comfortable with their level of knowledge on the subject.”Most people wouldn't jump out of a plane if they didn't know how to use a parachute, yet each year many buyers commit to the largest loan they will take out in their lifetimes without understanding essential information about mortgages,” said Zillow mortgage marketplace director, Erin Lantz.Among many points, 42 percent of buyers inaccurately thought loans made through the Federal Housing Administration were just for first-time buyers, while more than a third didn't know closing costs could vary from lender to lender.Getting a better understanding of the process could help buyers take advantage of current conditions. According to Freddie Mac, the average interest rate for a 30-year fixed-rate mortgage last week was 4.78 percent.Courtesy of 2M Realty News

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