by Francis Jock

Created on: May 25, 2009   Last Updated: March 03, 2010

For the first-time home buyer, finding ways to save money is an important consideration.After all, going in debt by borrowing tens of thousands of dollars for twenty or thirty years is a huge financial commitment and a lengthy legal process that is both complicated and mysterious. This article will take a look ways for the home buyer to save money by negotiating typical fees and costs charged by lenders for mortgage loans.

Mortgage loan origination fees. Mortgage loan fees are charged by lenders to get as much money as they can from you. Typically, borrows are told that fees are charged in order to cover the cost of processing the loan or providing some other service, even though they are going to reap huge profits by packaging and reselling your mortgage to another financial institution. The good news is that mortgage loan lenders compete for every dollar of your money so you can save by shopping around for a lender that charges the lowest, or no mortgage loan origination fees.

Interest rates vs. Lower Monthly Payments. There's a financial trade-off between the size of the down payment, the interest rate you will be paying, and how much the monthly mortgage payment is going to be for the next 30-years. Take a look at an amortization table, which your lender can provide you, to get an idea of how interest rates, principle and interest payments are going to affect your budget for the amount of money you are borrowing.

Down Payment Amount. The more money you put down on your house, the less you have to finance, and the lower your monthly payment. It makes sense to save as much money as you can and make the largest down payment possible. If you are saving for the day when you can afford to buy a home, be sure to calculate and add in the effect of creeping inflation on the price of homes.

Typically, lenders require a minimum of 20% down, although lower percentages are available with Private Mortgage Insurance, which insures the lender's risk of loaning money with a lower down payment percentage. Government backed guaranteed loans, such as FHA and VA loans and a few others, may not require any down payment at all.

Fixed Interest Rate Loans. Mortgage loan interest rates are either fixed for a certain period, typically 15, 20, or 30 years, or they are adjusted periodically. Fixed rate loans are locked in when the loan is initiated and never change over the life of the loan, regardless of the effect of changing interest rates. Fixed rate mortgage loans carry have a

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