Financing Questions
Q. WHERE DO I START?
A. Pre approval. Before you begin to search for a house, call a lender you are comfortable with and have them pre approve you for a loan. This process will give you a price range to begin looking for a home. Once you have found your dream home the pre approval will give you "buying power" when making an offer.
Q. ONCE I HAVE A CONTRACT ON A HOME, HOW LONG DOES IT TAKE TO PROCESS A MORTGAGE APPLICATION?
A. Usually about 45 to 60 days. Although it can take as few as 30 days or as long as 90 days for some transactions. The actual time depends on how quickly the Lender can get an appraisal of the property, a credit report and a verification of employment and bank accounts.
Q. COULD ANYTHING DELAY APPROVAL OF MY LOAN?
A. If you provide the lender with complete, accurate information, everything should go smoothly. You may face delay if the lender discovers credit problems — a history of late payments or nonpayment of debts, or a tax lien. You may then be required to submit additional written explanations or clarifications. You should also be sure to notify your lender if your personal or financial status changes between the time you submit an application and the time it is funded. If you change jobs, get an increase (or decrease) in salary, incur additional debt or change your marital status, let the lender know promptly.
Q. WHAT DOES THE CLOSING COSTS INCLUDE?
A. Closing cost cover processing and administration of your loan. In addition to a loan fee, you will usually be asked to prepay interest charges to cover the partial month in which you close, and impounds for property taxes, hazard insurance and mortgage insurance. The buyer is also required to pay for any inspections that are made to the property.
Q. WHEN DO MY MORTGAGE PAYMENTS START?
A. Usually about 30 days after closing. The actual date of your first payment will be included in your closing documents.
Q. WHAT IS INCLUDED IN MY HOUSE PAYMENT?
A. Principal and interest on your loan. Depending on the terms of the loan, the payment may also include hazard insurance, mortgage insurance and property taxes.
Q. CAN I PAY THOSE OTHER THINGS SEPARATELY?
A. Not if it is an FHA insured or VA loan. With most other loans, you can pay your own taxes and insurance if you borrowed no more than 80 percent of the purchase price or appraised value of your home. Check with your lender to be sure.
Q. CAN I GET AN IDEA OF WHAT MY PAYMENT WOULD BE?
A. The Mortgage Calculator below can give you an estimate of your payment based on interest rate and number of years of the loan. It will not calculate other items that may be included in payment.