Mortgage Loan and Refinancing Frequently Asked Questions

Purchasing a home Rule 101
When applying for a home purchase mortgage what the consumer should know.

The most important thing you can do when obtaining mortgage financing is to be absolutely certain that you can afford it. Are you ready for a long-term mortgage commitment? Do you have stable and consistent income and employment? Are you doing this alone or with a partner? If you are doing this with a partner do the both of you have the financial and credit qualifications needed to qualify...

The first step in applying for a mortgage is to obtain an accurate quote and where do you begin? It begins with a pre-qualification method that starts with credit, income and an assets evaluation... How much of a down payment do you intend to place down on contract if any at all? There are many mortgage programs out there for perspective borrowers who can get approved for one-hundred percent financing for the purchase of a home, but are for exceptional credit borrowers who qualify and programs may vary from state to state.

Lets say you are pre-approved and you are ready to start viewing homes... You view a home that you are very interested in purchasing. You then place a bid on the home and wait to see if the homeowner accepts your offer. If it's not a full price offer be ready renegotiate. It is okay if you feel that you cannot afford to up your offer if denied. If this is the case than continue your search until you find a home that is right for you and your situation.

There will come a point that you will have viewed many homes and have a first accepted offer and are ready to go to contract. If you are a first-time or seasoned homebuyer then you should be very aware of certain issues that need to be dealt with... An engineers report is not needed by the bank but is extremely suggested to have done to be sure that the structural condition of the home is safe. The engineers report will contain a full evaluation of the homes electrical wiring, what was used in the construction of the home when it was built, is the heating and hot water system up to par, and is the roof free of leaks from rain. These are some of the more important issues that will help you determine if the home is a safe investment. A termite inspection will have to be done and the bank for a home purchase will require that...

You must remember to do one very important thing and that is to hire a real estate attorney to whom specializes in home contract law, some are better than others and you should hire one that you are very comfortable with. It is essential to be able to communicate with that person and there staff at all times when your questions arise. The attorney to whom you hire is responsible for ordering the title report on the home and is responsible to make sure that the homes title if free and clear of liens and that all certificates of occupancy are in order before you can close.

Mortgages and closing costs Rule 101
Are you getting the right mortgage at the right price?

You are applying for a mortgage and are concerned about the costs, charges and fees. Will you be paying points or other related discount fees to buy the rate down, and if so, is it worth it?

Buying the rate down is okay if you intended on occupying the residence for a long period of time. Technically a buy down of points is interest paid in advance and can lower your monthly mortgage payment. Are these points taxed deductible? Yes they are, however they can only be deducted over the term of the mortgage not in one lump sum at the end of year... Fortunately If you are refinancing your current mortgage you can now deduct those points you paid from your last closing in full at the end of that year...

You must be aware that there are many related charges relevant to a mortgage that cannot be avoided, the mortgage tax for instance. State tax, intangible tax, doc stamps or whatever taxes the state you reside in imposes... Other related closing fees range from such as recording fees, pickup fees and title insurance charges to insure that the home be free and clear of all liens. Title insurance is to protect you from any liens that may have been overlook at the time of closing and if anything should arise after you take title to the home, the title insurance that you paid for will be responsible for paying off those lines. All of these costs and charges can be nominal but are required for a mortgage... If you are refinancing you may entitled to a price break on some of these costs and charges but must ask your lender, broker or loan agent if you qualify for any of them...

America is made up of two kinds of states when it comes to mortgage financing a lien theory state and a title theory state. What this means is that in a lien theory state an attorney is required to close and fund the loan on behalf of you and the Bank/Lender while a title closer handles the title closing. In a title theory state a title closer will close and fund the loan on behalf of you and the Bank/Lender and handles the title closing Simultaneously.

The Good Faith Estimate (GFE) is a good faith estimate of costs and charges that a consumer receives at the time of application and can be very close... The Truth In Lending statement (TIL) also known as the HUD issued at closing will be the actual costs and charges and all disbursement of all monies from the closing as to where they went and to whom received them down to the last the last cent.

These are some the Frequently Asked Questions we as a mortgage firm are asked on a daily basis. We bring them to you to help educate the consumer in the hopes of gaining trust and confidence... We invite you to call us Toll Free at 1-888-695-6261 with any questions you may have as we look forward to providing you with excellent service.

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