10
Sep
By support
Home Mortgage Tips

FHA Home Loans: How to Pre-apply and Get Approved Before Making a Home Purchase Commitment

FHA Home Loans: How to Pre-apply and Get Approved Before Making a Home Purchase CommitmentIf you’re in the market for your first mortgage, the Federal Housing Administration may be able to help you. Thanks to the FHA home loan program, you can apply for loan approval before you’ve found a home that you want to buy – which means you know what you can afford before you start your house hunt. Here’s what you need to know about FHA home loans and how they can help you find the perfect house.

Pre-Approval: Assessment Includes Employment History and a Credit Check

The pre-approval process can be done over the phone or online in a matter of minutes. All you need to do is find a lender or mortgage broker in your area and start the application process. You’ll be asked a series of questions and you’ll need to meet several criteria, such as a history of steady employment and consistent income, a credit report in good standing, and a desired mortgage payment of 30 percent of total monthly gross income.

The Variables of the Loan May Change Depending on Your Needs

When the representative for the broker or lender contacts you, he or she may overestimate your property taxes and will assume that you are going to borrow the maximum amount for which you qualify. Therefore, the monthly payment that you are quoted may be higher than the amount that you would pay each month when you actually purchase your home. Based on the property taxes, your down payment and the purchase price of the home, your payment may be higher or lower at closing.

You Will Get a Letter Stating That You Have Conditional Approval

If all goes well, the lender or broker who assessed you will send a letter confirming that you are conditionally approved for an FHA home loan. You may wish to submit this letter with any offer that you make to purchase a house, as without conditional loan approval, a seller may not take your offer seriously. If you are in a bidding war for a home, it may not be possible to win unless you show that you have financing available to close on the property in a reasonable amount of time.

The first step to get a mortgage is to get conditional loan approval. By calling your lender or a broker, it may be possible to obtain pre-approval for the mortgage you need while also negotiating favorable terms. For more information about qualifying for FHA loans, contact your local mortgage professional today.

04
Sep
By support
Home Mortgage Tips

Children Leaving the Nest? 3 Pieces of Sage Advice You Can Share About How to Manage a Mortgage

Children Leaving the Nest? 3 Pieces of Sage Advice You Can Share About How to Manage a MortgageWhen your children are about to step out into the world on their own, you want to help them on their way. This especially holds true when it comes to buying a house. As your sons or daughters prepare to take the plunge into home ownership, make sure they follow three crucial tips that will help them during the mortgage process.

Don’t Bite Off More Than You Can Chew

One of the biggest mistakes that homeowners make is choosing a home that is beyond their price range. Your children need to remember that they are going to be paying for their home for a long time. A crushing house payment could be difficult to manage.

In order to find a reasonable mortgage, you need to look at the numbers. The bank, or mortgage lender, will generally look at a client’s income, debt, and the current mortgage rate to determine an acceptable amount when purchasing a home. Your children can look at their own budget, lay out all of their costs, and determine how much spending room is left for a house payment.

Choose A Shorter Term For A Mortgage

When the time comes to sign the dotted line, the mortgage lender will offer various payment terms for your child’s home loan. Twenty-five to thirty years is the typical term for most mortgages, but the sooner the mortgage is paid, the better. Advise your children to choose the shortest possible term while still living within their means.

Make Extra Payments When Possible

Your children can pay their mortgage off sooner by making extra payments. While this may seem like a challenge, it can be accomplished with careful budgeting.

Making one extra payment a year will shorten the length of the loan and put more equity into the home. Whether your children plan on staying put or want to buy another home down the line, they’ll appreciate it when they have paid off a considerable chunk of their mortgage.

Getting a mortgage is a rite of passage and a milestone that thousands of Americans encounter every year. Make sure that your children get the best mortgage available by following these tips. For more helpful information, or to make sure your children are getting a good deal, contact a trusted mortgage professional today.

27
Aug
By support
Home Mortgage Tips

Refi or Wait? How to Choose Between Refinancing Your Mortgage Now or Waiting Until You Need the Money

Refi or Wait? How to Choose Between Refinancing Your Mortgage Now or Waiting Until You Need the MoneyRefinancing your existing mortgage may provide you with the opportunity to lower your interest rate, reduce your mortgage payment and adjust your loan term. For those homeowners who have lived in their home for more than a few years, pulling equity out of the property for everything from a luxurious vacation to making home improvements is a tempting potential benefit.

However, with property values and interest rates adjusting frequently, you may wonder if now is the best time to refinance your mortgage.

Using Equity From Your Refinance

One factor to consider when debating between refinancing now and waiting relates to pulling equity out of your home. If you need access to the cash now for home improvements or other purposes, refinancing now may be ideal. Even if you do not need access to your equity for several months or longer, you can lock in today’s rates and invest the money in other vehicles, such as CDs or bonds, until you need the cash.

Anticipating Market Changes

You may have heard that the interest rates for home mortgages have been slowly rising, and while they remain close to historic lows, they are projected to continue to rise. Nobody can predict with certainty how interest rates will adjust in the next few months and years, and locking in today’s rates may be beneficial. Keep in mind that if rates decline significantly in the near future, you can always look into refinancing again.

Reducing Your Principal

If you have a higher interest rate on your existing mortgage, your principal balance may be reduced at a slower rate than if you refinance to a lower interest rate. In addition, if you refinance from a 30-year term to a shorter term length, your principal balance will also be reduced more quickly in most cases. In many situations, refinancing your home mortgage today may establish a more efficient repayment schedule that allows you to accrue equity at a faster rate.

Each homeowner has unique factors to consider when refinancing based on property value, credit rating, existing loan terms and other factors. While many will benefit by refinancing an existing mortgage today, you can speak with a mortgage professional for specific advice and recommendations regarding your situation. Call your trusted mortgage representative today to inquire about the options and to begin working on your refinance loan application.