GETTING A MORTGAGE?
We know applying for a mortgage can be confusing, especially if you're a first time homebuyer. The best thing you can do is meet with a reputable lender. Talk to them about what type of home you want to purchase, what your budget will allow, and what type of mortgage you might seek. Be prepared to answer any questions that a lender might have for you and be open & straightforward about your circumstances. Despite what the media says about how difficult it is to acquire a home loan, there are loads of qualified buyers out shopping for a new place. You can be one of them!
BUT, before you go for your pre-approval letter letter (which you will need as you start your search) there are a few things you'll need to have when you meet with your lender:
• The name & address of your bank, your account numbers, and statements for the past six months
• Investment statements for the last two months
• Pay stubs, W-2 withholding forms or other proof of employment and income
• Balance sheets & tax returns if you're self employed
• Information on consumer debt with account numbers and amount due
• Divorce settlement papers, if applicable
With this information, your lender will be able to verify your income & bank account information plus obtain a copy of your credit report.
Contact your Twin Oaks professional who can refer you to qualified lenders.
WHICH MORTGAGE IS RIGHT FOR YOU?
There are a variety of loans available to suit buyers with different circumstances and goals.
Fixed Rate Conventional Loan: As the name implies, the interest rate remains the same throughout the life of the loan. Your monthly payment generally remains the same as well. The only change in payment you may see is in the escrow amount if your taxes and/or insurance monthly amounts change. The entire loan is repaid in equal monthly installments over the length of the loan. These low risk loans are available in either short term (15 or 20 years) and long-term (30+years).
Adjustable Rate Conventional Loan (ARM): With a variable rate mortgage, your interest rate is adjusted periodically, keeping pace with changes in interest rate fluctuations. What this means is that your monthly payment amount is recalculated with each rate adjustment. Depending on what's specified in the mortgage contract, an ARM can be fixed for a period of time, up to 10 years, and then adjust periodically. An ARM is considered to be a higher risk loan since your payments may fluctuate due to market conditions, but can be a great option for someone who does not plan to stay in the mortgage long-term.
FHA Loan: An FHA loan allows for the purchase of a home with a low down payment of only 3.5% of the purchase amount. These loans also tend to be more lenient on credit scores and debt-to-income ratios, thus making them a good choice for first time home buyers.
VA Loan: VA (Department of Veteran's Affairs) mortgages are another low down payment option. VA mortgages are available to qualified veterans and their surviving spouses. VA mortgage terms are also generally very attractive, and in many cases, little or no down payment is required.
Again, the best plan is to start with a reputable, experienced loan officer. While shopping for your loan be sure and compare 'apples to apples' in looking at their fees and closing costs. Contact us. We can recommend local reputable lenders who will take the time to find a loan program that's right for your circumstances.
Equal Housing Opportunity. Twin Oaks Realty is a proud member of the National Association of REALTORS®.