Principle, Interest, FHA, Conventional, Fixed, ARM...Confused??
You don't need to be. I have a Loan Consultant who is willing to answer all those questions. She offers a FREE loan consultation to discuss all your mortgage options.
Just call or e-mail:
Robin Iverson, Spectrum Financial Group (BK0904796)
602-999-7615
riverson@sfgmortgage.com
FYI: If you use Robin and I to handle your real estate and loan transaction, at successful close of escrow, we will each give you $250 to use toward your appraisal and home inspection. That's $500 in your pocket. Good Deal! No, Great Deal! Call today.
Securing a Loan - Who Are The Players?
Loan Consultant: Your direct connection to the home loan process. Person who brings together a borrower and lender and handles the necessary applications to obtain a loan against real property.
Mortgage Company: A company authorized to arrange real estate loans.
Lender: Person or entity advancing funds which are to be repaid. A general term encompassing all mortgagees and beneficiaries under deeds of trust.
Processor: Person responsible for reviewing all documents submitted by the loan consultant to secure the loan and preparing the file for underwriting.
Automated Underwriter: Computer system programmed to calculate all facts and figures entered and determine if the loan can automatically be approved based on credit scores, debt ratios, etc. System is fast and requires less documentation.
Manual Underwriter: Person who reviews loan application documents, appraisal and other documents supplied by the Buyer and gives final loan approval. Can be slower, however, can also be more flexible and creative in some situations, but requires more documentation.
Funder: Final person to review loan documents to insure everything is in order and then sends funds to the title company with approval to record all documents and close the transaction.
Pre-Qualification vs. Pre-Approval
When you are pre-approved for a loan, you can begin looking with the confidence of knowing, if you find your dream home, you can buy it. And most importantly, when you are pre-approved for a loan, you have much more negotiating and bargaining power with the Seller to secure the very best price and terms for your new home.
Pre-Qualification determines approximately how much of a home you can afford based on your financial resources (proceed with caution).
Pre-Approval is a guaranteed commitment for an exact dollar amount from a financial institution (green light means go).
What Determines Loan Approval?
Income: Where and what is your source of monthly & yearly income. If employed with a business, income can most likely be verified from a weekly or monthly pay stub. If self-employed, income can most likely be verified by a 1099 form drawn by the business, tax returns or your accountant. If you receive child support, alimony, rental payments or stock dividends, etc., income can most likely be verified by cancelled checks, decrees or bank statements.
Debt: Wo do you owe monthly? Debt is a payment that you are responsible for on a monthly basis and is determined most likely by what shows up on a credit report or possibly a divorce decree. Such as, car payments, credit card payments, child support payments.
Credit: What is your credit history and credit score? When a tri-merge credit report is run (credit report from three different credit bureaus), each transaction is rated based on the amount owed and your payment history. Points are awarded for making payments on time and deducted for late payments, write-offs, bankruptcies, etc.
Cash Required: Where are funds to close coming from? A review will be made on the source of your down payment and closing costs to determine if you will have the money to close on your new home. Do you have enough in your checking account, will it be coming from the sale of your existing home, will you be borrowing on a retirement account, will the funds be gifted, etc.
What's In A Payment - PITI?
(P)rinciple: The actual balance owed on the loan
(I)nterest: The amount of interest paid each month on the loan determined by the interest rate locked in when securing the loan.
(T)axes: The amount of taxes paid each month on the property determined by the actual assessment of value by the County Assessor's Office. Held in an impound account and paid by the mortgage company twice a year. Can vary during the term of the loan.
(I)nsurance: The amount of hazard/property insurance paid each month determined by the insurance carrier. Held in an impound account and paid by the mortgage company once a year. Can vary during the term of the loan.
Mortgage Insurance: Depending on how much you have put as a down payment calculated on a monthly basis and paid directly to the mortgage insurance carrier. Not required if 20% down payment is given at time loan is secured.
(HOA) Homeowners Association Dues: Monthly, Quarterly, Semi-Annually or Annually assessed amount required by the HOA. While it is figured in your payment for qualifying, it is paid separate from your mortgage payment.
