|
Lesson 3: Getting a
Mortgage
A mortgage is a loan for which
your home serves as the collateral. A basic monthly mortgage payment consists of
the principal amount being borrowed, interest, taxes and insurance.
There are many different types of
mortgages. Which one is right for you? When reviewing your options, you should
consider your current financial picture, how your finances might change in the
future, how long you intend to remain in the home, and how comfortable you are
with fluctuating mortgage payments.
What
Kinds of Home Mortgages Does M.O.M. Offer?
1.Fixed
Rate: Security and Stability
Fixed-rate
mortgages remain the most popular type. With these loans, the interest rate is
fixed for the life of the mortgage, so your monthly payments never
change.
2.Adjustable Rate Mortgages: Flexibility and Control
Adjustable-rate mortgages (ARMs)
generally start out with an interest rate lower than a fixed-rate loan. This
saves you money early on, and may help you qualify for a more expensive home.
However, your rate is tied to a market index. As the index goes up or down, your
payments will also change at each scheduled adjustment period. There are "rate
caps to limit the amount your mortgage can go up or down.
3.Special
Mortgage Programs: For Unique Borrowing
Needs
M.O.M. offers a variety of home financing options for customers with
special considerations. These may include special credit needs, stated income
programs, low down payments options, affordable home loan programs , or
Manufactured Home Loans .
Get
Organized
You've identified your price range
and have learned about the mortgage options that may be right for you. Now it's
time to gather all the information and supporting documentation you'll need to
apply for a mortgage. Getting ready ahead of time will help the process move
along quickly and smoothly.
Arrange your
paperwork
Here are some of the documents you may need to prepare for the home
financing process:
- Your
social security number (or proof of permanent residency)
- Pay
stubs for the last 2 months
- W-2
forms for the past two years.
- Bank
statements for the past 3 months.
- 2 years
of Federal tax returns if self employed.
- A signed
contract of sale (if you've already chosen your new home)
- Information on current creditors-car loan, student loan, credit cards,
etc.
Review a copy of your
credit report
Your
credit report will be ordered by M.O.M. as part of your application process;
however, if you review your credit report and address any errors before you
apply, you can avoid potential delays during processing. Make sure your credit
report accurately reflects your current credit situation.
Remember, when assessing your
financial picture, be as honest and thorough as possible. That's the best way to
secure the mortgage that's right for you. There are mortgages for just about
every buyer and situation.
Home
Inspection
You should get a Home Inspection
prior to closing. A pre-purchase home inspection, performed by a professional,
is a visual examination of the readily-accessible areas of a home to provide an
accurate evaluation of the home's condition at the inspection. This evaluation
is presented to the buyer in a comprehensive report so buyers are fully informed
of the home's condition prior to purchase. While a home inspection is not
required by M.O.M. , it is something you should consider.
When should I apply
for a mortgage?
- When you
have a firm agreement with the seller to purchase a specific
property.
- At least
60-90 days prior to the date you would like to move
in.
Keep in mind,
even if you do not have a specific property address, you can still apply for
your mortgage. M.O.M. can issue a credit-only pre-approval subject to receipt of
a satisfactory purchase contract and appraisal and a verification of the income,
debt and asset information you provide.
How Can I Apply with
M.O.M.?
- Answer some
basic questions and we'll have a Mortgage Consultant contact you at your
convenience. You can complete our online mortgage application at your own pace
and when it is convenient for you.
- Make one easy
phone call to M.O.M.. Just dial 866-496-4666
or 320-271-4666, and a M.O.M.
Mortgage Consultant will take your information over the telephone, and work with
you so that you have everything you need to close your
mortgage.
- You can work
face-to-face with a local expert. Come on in to
our local office
to visit with
us.
Once you submit your application,
a M.O.M. Mortgage Consultant will provide personal service to move the process
along. He or she will answer your questions about the different types of
mortgages available and current rates. You'll need to provide your Mortgage
Consultant with information on your income, credit history, debts, and liquid
assets. If you've already gathered this documentation, things should go
smoothly.
What happens After I
Apply?
Once you apply
online, your application will typically proceed as
follows:
- A
Mortgage Consultant will review your information and contact you directly to
answer your questions. He or she will also request from you any required
documents that may be needed to begin processing the
application.
- Next,
your Mortgage Consultant will place orders for a property appraisal, a survey of
property boundaries, a flood determination, as well as a title search and title
insurance.
- The
Underwriter will review all your information and decide whether to approve or
deny the loan. The Underwriter will not have direct contact with
you.
- Finally,
the Closer will assemble the closing package, and ensure that all fees and other
closing payments are accurately documented. In most cases, he or she will
establish an escrow account for payment of necessary insurance and real estate
taxes. Lastly, the Closer authorizes the mortgage funds for disbursement. You
will be contacted to schedule a date and time for the closing.
<Lesson
2
Lesson
4 >
|
