Home Loan FAQ
Who orders the appraisal, and will I get a copy?
The bank will order the appraisal on your behalf. Once a completed report is returned to the bank, you will receive a copy of the full report.
Do you provide financing for a manufactured home?
Yes, however, some restrictions apply. Please contact a mortgage banker to discuss financing options.
What is mortgage insurance and when is it required?
Mortgage insurance should not be confused with mortgage life insurance, which is designed to pay off a mortgage in the event of a borrower's death. Mortgage insurance makes it possible for you to buy a home with less than a 20 percent down payment by protecting the lender again the additional risk associated with low down payment lending.
Low down payment mortgages are becoming more and more popular, and by purchasing mortgage insurance, lenders are comfortable with down payments as low as 3-5 percent of the home's value. It also provides you with the ability to buy a more expensive home than might be possible if a 20 percent down payment were required.
The mortgage insurance premium is based on the loan to value ratio, type of loan, and amount of coverage required by the lender. Usually, the premium is included in your monthly payment and one to two months of the premium is collected as a required advance at closing.
It may be possible to cancel private mortgage insurance at some point, such as when your loan balance is reduced to a certain amount - below 75 percent to 80 percent of the property value. Recent federal legislation requires automatic termination of mortgage insurance for many borrowers when their loan balance has been amortized down to 78 percent of the original property value.
If you have any questions about when your mortgage insurance could be canceled, please contact your mortgage banker.
When and how can I lock my rate?
There are many variables that need to be considered before locking your interest rate:
- How long until closing?
- Do you want the flexibility to change your loan amount or your loan term?
- Are you risk-averse?
We understand each borrower has a unique situation, please contact your mortgage banker to discuss rate lock timing and the process to lock your interest rate.
What is the maximum percentage of my home's value that I can borrow?
The maximum percentage of your home's value depends on the purpose of your loan, how you use the property and the loan type you choose. So, the best way to determine what loan amount we can offer is to complete an online application. You can apply online or contact a mortgage banker for details.
Can I apply for a loan before I find a property to purchase?
Yes! Applying for a mortgage loan before you find a home may be the best thing you could do! If you apply for your mortgage now, we'll issue an approval subject to you finding the perfect home. You can use the pre-qualification letter to assure real estate brokers and sellers that you are a qualified buyer. Having a pre-qualification for a mortgage may give more weight to any offer to purchase that you make.
When you find the perfect home, you'll simply call your mortgage banker to complete your application. You'll find an opportunity to lock in our great rates and fees then, and we'll complete the processing of your request.
Will I be charged any fees if I authorize my credit information to be accessed?
There is no charge to you for the credit information we'll access with your permission to evaluate your application online.
Can I really borrow funds to use towards my down payment?
Yes, you can borrow funds to use as your down payment! However, any loans that you take out must be secured by an asset that you own. If you own something of value that you could borrow funds against, such as a car or another home, it's a perfectly acceptable source of funds. If you are planning on obtaining a loan, make sure to include the details of this loan in the Expenses section of the application.
If I have income that's not reported on my tax return, can it be considered?
Generally, only income that is reported on your tax return can be considered when applying for a mortgage. Unless, of course, the income is legally tax-free and isn't required to be reported. Some lenders may offer a stated income program, which means that you can be qualified for a loan based on the income you state rather than that which can be verified. Usually, these programs require larger down payments and offer interest rates that are substantially higher than regular mortgage rates. We do not offer stated income programs at this time.
If my property's appraised value is more than the purchase price, can I use the difference towards my down payment?
Unfortunately, if you are purchasing a home, we'll have to use the lower of appraisal value or the sales price to determine your down payment requirement. It's still a great benefit for your financial situation if you are able to purchase a home for less than the appraised value, but our investors don't allow us to use this "instant equity" when making our loan decision.
I'm getting a gift from someone else. Is this an acceptable source of my down payment?
Gifts are an acceptable source of the down payment if the gift giver is related to you or your co-borrower. We'll ask you for the name, address, and phone number of the gift giver as well as the donor's relationship to you. If your loan request is for more than 80 percent of the purchase price, we'll need to verify that you have at least five percent of the property's value in your own assets. Prior to closing, we'll verify that the gift funds have been transferred to you by obtaining a copy of your bank receipt or deposit slip to verify that you have deposited the gift funds into your account.
For more information regarding home loans, contact a member of our Mortgage Banking Team at 800-254-0615.