1. WHY DID MY REALTOR REFER ME TO YOU?
2. WHY SHOULD I USE A REALTOR
3. WHY AND HOW DO INTEREST RATES CHANGE?
4. WHAT HAPPENS ONCE I AM PREAPPROVED?
5. WHEN SHOULD I CONSIDER REFINANCING?
6. WHAT IS AN ORIGINATION FEE?
7. WHAT IS TITLE INSURANCE?
8. WHAT IS MORTGAGE INSURANCE?
9. HOW DO I GET PRE-APPROVED?
10. WHAT ABOUT MY CREDIT HISTORY?
WHY DID MY REALTOR REFER ME TO YOU?
A high quality realtor knows that the key to a successful transaction means TEAMWORK with a professional mortgage banker. Any experienced realtor could tell you horror stories about times when a client made a poor choice of mortgage company, and ended up with big surprises at the closing table, or worse, no closing taking place at all! A good realtor will form relationships with trusted individuals who have proven themselves time and time again, so that they know you will be given the excellent service that you deserve. It is important to know that your realtor is NOT given any compensation or "kickbacks" for referring you to a mortgage banker. As mortgage professionals, we desire more referrals, both from you and your realtor, so consider the extra motivation this provides for us to take great care with your satisfaction!
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WHY SHOULD I USE A REALTOR?
First and foremost, because you need an experienced professional working on your behalf. The realtor's commission is not paid by the buyer, but by the seller of the home being purchased, and it is in each party's best interest to have professional representation. As a seller, profits are generally maximized by having an experienced realtor market and sell your home, rather than deal with the headaches of trying to do it all on your own. See our page on "selecting a realtor" for more information.
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WHY AND HOW DO INTEREST RATES CHANGE?
Many people are surprised to learn that rates change on a daily and sometimes hourly basis. Interest rates fluctuate in response to changes in the financial markets. The bond market is generally a good indicator of the general trend of interest rates.
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WHAT HAPPENS ONCE I AM PREAPPROVED?
You are ready to buy a home! Remember that it is very important to inform us of any changes in the financial information that was provided at the time of approval, as it may make a change in the amount or type of loan that you can qualify for.
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WHEN SHOULD I CONSIDER REFINANCING?
The old rule of thumb was at least 2%, but this is no longer the case. Many different individual factors need to be analyzed to determine if refinancing is right for you, such as the length of time you intend to stay in your home, or the type of loan you currently hold. We are always happy to provide a recommendation to you for your particular circumstances.
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WHAT IS AN ORIGINATION FEE?
Typically, it is 1% of your loan amount, and works exactly like a discount point. You can avoid all or part of this fee by paying a higher interest rate. In Minnesota, rates are typically quoted assuming this 1% origination fee.
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WHAT IS TITLE INSURANCE?
It is a policy provided by the title company guaranteeing the accuracy of the title work done on your home at the time of purchase. As a buyer, you are required to purchase a lenders policy of title insurance as part of your standard closing costs, which only protects the mortgage company. You may also choose to purchase an owners policy, which would protect you against any loss in the event of any legal issues relating to the title of your home.
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WHAT IS MORTGAGE INSURANCE?
This is generally required in one form or another when the down payment is less than 20%, and protects the lender in the event of loan default. The lower the down payment, the higher the risk for the lender, and thus the higher the monthly premium. Depending on your particulars, there are ways in which mortgage insurance can sometimes be avoided at purchase, or dropped altogether at some point in the future.
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WHAT DOES IT TAKE TO GET PRE-APPROVED?
What does it take to get pre-approved? Not as much as you might think! With a short phone conversation, I can provide you with your credit rating, approximate amount you qualify for, and list of items needed to finish the approval. Generally, if you have a few basic items available to fax, such as a recent pay stub, last two years W2 statements, and a recent bank statement, I can provide most clients with a pre-approval letter within 15 minutes.
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WORRIED ABOUT CREDIT?
Are you worried about your credit history? Just about everyone has something in their past credit that is less than perfect. The most important thing is to learn what is on your report, determine what impact that information has on your credit rating, and work on repairing and restoring any damage that may have been done.
Mortgage loan options are rated by credit, labeled like school grades - "A" credit is the best, then down to A-, B, C, etc. Even if you do not have an A credit rating, we can let you know what your options are if you fall into an A- or lower category. The rates are generally going to be higher, and may require a down payment. If you determine that you are not satisfied with this type of financing, then together we can map out what you need to do with your credit and finances for the next six to twelve months in order to qualify for an A credit loan.
There are three main credit bureaus that most creditors (such as credit card companies, banks, leasing companies, etc) provide information to on a monthly basis. Each month, your credit holders report information to the credit bureaus about your current balance, minimum payment requirements, and credit history. If you need specific information from one of the major credit bureaus, following is the contact information for each of them:
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Experian Information Service (XPN)
PO Box 2002
Allen, TX 75013
(888) 397-3742
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TransUnion (TUC)
PO Box 1000
Chester, PA 79022
(800) 916-8800
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Equifax Information Services (EFX)
PO Box 740243
Atlanta, GA 30374
(800) 685-1111
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To order a free credit report and analysis, please call Vanessa at (949) 521-0015 or Click here to e-mail your request.
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