The monthly payment:

What's amount? Will it stay same or change?

Prepayment penalties:

Prepayment penalties are extra fees that may be due if you pay off loan early by refinancing or selling your home.

Whether interest rate for loan will increase if you default:

An increased interest rate provision says that if you miss a payment or pay late, you may have to pay a higher interest rate for rest of loan term.

The best piece of advice would be to ensure that you can afford loan. Figure out whether your monthly income is enough to cover each monthly payment, in addition to your other monthly bills and expenses. If it isn't, do not take out a loan.

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You'll need to figure out on paper your current situation - what you own and what you owe. You'll be creating a “net worth statement.” On one side of page, list what you own. These are your “assets.” And on other side list what you owe other people, your “liabilities” or debts.

Subtract your liabilities from your assets. If your assets are larger than your liabilities, you have a “positive” net worth. If your liabilities are greater than your assets, you have a “negative” net worth.

You'll want to update your “net worth statement” every year to keep track of how you are doing. Don't be discouraged if you have a negative net worth. If you follow a plan to get into a positive position, you're doing right thing.

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