Buy a house and get a mortgage loan can be a scary process real. I have worked with buyers for years and would like to share with you some tips to make the loan process for you.
Three typical buyer questions
1. How I can qualify for a loan? Start by meeting with a lender. The lender will help you explore options for funding a
2. How to select a lender? Call two or three different lender, conduct a brief phone interview and then make an appointment with which you feel most comfortable.
3. How does the lender determine my credit rating? A general guide, you can buy a house valued at two to three times their annual income. The lender will also consider your savings and debts.
There are programs for buyers with credit problems. Ask the lender that is best for you.
When should I call a real estate agent? Meet with a first lender to determine credit ratings.
1. Get a pre-qualification letter.
2. Conduct a brief telephone interview with two or three real estate agents.
3. Select the real estate agent that you feel most comfortable.
4. Make an appointment.
5. You may be asked to sign a buyer agency agreement. It’s okay to sign a short-term agreement.
6. Before signing a long-term agreement, make sure you are comfortable with the Realtor.
His first meeting with the realtor.
Being open-minded. Make a list of the features you want in your home:
1. How many bedrooms?
2. Need a garage?
3. How far to go to work?
4. Do you have pets?
5. … etc
If you get the real estate agent defined parameters,. can find a home for you. Your first meeting with a lender
Your lender needs to know everything about your finances. The following is a list of the information you need to take with you:
salary and bonuses.
Two years of tax returns or W-2 forms.
military history. Amount
dividends and interest.
Other regular income, such as alimony, child support, etc.
current bank statements, both checking and savings.
Market value of stocks, bonds or certificates of deposit.
face amount and cash value of life insurance policies. Value
personal property and automobiles.
The balances and account numbers of loans, credit card balances and personal loans.
four types of loans:
1. Fixed rate -. The interest rate stays the same during the life of the loan
2. Adjustable / Variable Rate – the interest rate can change during the life of the loan.
3. Government Loans -. VA and FHA
4. Bridge / Swing Loans – short term loans that are paid quickly. Which one is right for you? Many factors
enter the selection of a loan:
their financial circumstances. Expectation
of future financial changes.
How long you intend to keep the property.
How comfortable you are with the monthly payment.
How comfortable you are with the amount of payment changing from time to time?
Discuss your preferences with the lender and the real estate agent.
What does my loan payment included? P
includes the payment of the principle amount
includes payment of interestT payments may include an escrow account to pay taxes
I can include the payments in an escrow account to pay for insurance
How much do I need for a down payment?
Payments vary. May be zero to twenty percent of the value of households. Veterans and active military personnel can get a loan with zero down.
What does the lender need to know about my credit?
If you have had credit problems, talk to your lender. Bring written explanations of credit problems. If the problems have been fixed and restored credit, you’re probably right. Credit problems does not mean you can not get a loan.
How long will it take?
Your lender must verify all information. The process can take from one to six weeks. Within three working days of the request of the lender must give you a “Good Faith Estimate” which is the amount of the closing costs you’ll be expected to pay and an estimated monthly payment. Stay in touch with your real estate agent and lender. Do not be afraid to ask questions. Sale Housing can be disconcerting, ask the professionals what to expect.
FHA – Federal Housing Administration loans are government-insured loans. They allow you to buy with a small down payment
VA Loans -. Loans from the VA are available for veterans and active military. A VA loan can demand any payment on sale
balloon – .. A caller to pay the entire loan due in a short period of time, although the loan may be amortized over a longer time period
APR – The true cost of a loan as a yearly rate
Evaluation -. An estimate of the value of the home, made by a professional appraiser. The maximum amount of the mortgage is usually based on the appraisal.Interest -. The amount paid for borrowing money
origination fee -. The fee charged by a lender to prepare all documents
Points – Prepaid interest on the loan, charged at the time of closing. Each point is one percent of the loan amount
PMI -. Private Mortgage Insurance is an insurance policy purchase borrower to protect the lender from non-payment of the loan Insurance
Title -. An insurance policy that insures you against errors in the title search, ensuring you and your lender’s financial interest in the property.
Hopefully this will help you make the confusion of buying mortgage process.
Wee Dilts author 2009
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