Choosing
a Loan
Here are some important questions to ask when shopping for a home
loan:
1. Is the loan assumable? Under what conditions can it be assumed?
2. Does the rate fluctuate? How?
3. Can the original borrower be fully released? Is there a charge?
4. Is there a pre-payment penalty? Is there a minimum pre-payment
amount? What happens if the loan is paid off early?
5. Is there a Private Mortgage Insurance (PMI) requirement? Can it
be removed? How?
6. Can taxes and insurance be paid separately from the loan payment?
Can this arrangement be changed by the borrower or by the lender?
How ?
Down
Payment Options
1. Personal Savings
2. Gift Letter
3. Personal Reserves/Sellable Assets
4. Home Equity
5. Joint Ownership
We Can Help You Find Financing
We work with many mortgage brokers throughout the area and can inform
you of different financing alternatives and help you arrange appropriate
financing.
Borrowing
enough money to buy a house can be intimidating. Your sales agent can
guide you through the process. Below is a listing of some of your options
when choosing a lending institution, and deciding on what kind of loan
to obtain. Look over the information, and we can discuss which ones
might be right for you.
A
Mortgage
A mortgage is a loan for the cost of the property. The title is held
by the lending institution until you pay the loan back according to
its terms. The length of time you have to pay it back, under what circumstances
you can repay early, the interest rates you pay for use of the loaned
money, and other terms, are all spelled out in the contract for your
mortgage. You will be expected to put some cash money into your purchase,
and you may have to prove to the bank that you have enough other money
to make your payment. Some mortgages are assumable, meaning the person
you sell the house to can assume your debt, and take over the loan payments.
Down
Payment
The down payment on your home will guarantee the lender that it will
not lose money if you fail to pay your debt. The lender requires the
mortgage to be less than the value of the house, so that the loan will
be paid back if the house has to be sold. The down payment makes up
the difference between the cost of the house, and the loan you can get
to purchase it.
The
Conventional Rate Mortgage
This is a mortgage with an interest rate that stays the same until the
mortgage is paid off. The exact terms of repayment, and the specific
interest rate available at any given time, is variable. You can call
institutions to find out their interest rates, or I can do it for you.
I can also help you calculate how much you can expect a bank to loan,
given your personal financial picture.
The
Adjustable Rate Mortgage (ARM)
An ARM is a loan with interest changing at different periods of time.
The rate changes may be predetermined and fixed, or they may be based
on variable factors, such as the one-year Treasury Security Index.
The
FHA Loan
FHA loans are insured by the Federal Housing Administration. This makes
this a very low risk loan for the lender. These loans are designed to
encourage lenders to make loans for residential properties. The terms
are also favorable for the buyer, and are worth consideration.
The
VA Loan
These programs offer long-term financing to eligible veterans or their
surviving unmarried spouses, with little or no down payment required.
VA loans are guaranteed by the Veteran's Administration.
Mortgage
Estimator
Our
online mortgage estimator below will figure out your mortgage payment.
Input all the appropriate information, then click on "Calculate"
to see your payment amount, or click on "Amortize" to see
the periodic payment breakdown. Please note: Actual costs may vary depending
on your lender. This calculator is designed to provide a guide only.
