FAQ's & Resources
Frequently Asked Questions
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What are the documents needed to get a mortgage?
1. Driver’s License
2. Last two years of W2s and Federal Tax Returns
3. Last 30 days of pay stubs
4. Last two months of bank statements
5. For any other properties and/or mortgages, provide: current mortgage statements, homeowners insurance declarations, and if there’s an Home Owners Association, include an HOA statement
6. If self employed, provide most recent business license and all corporate returns
7. If applicable, include social security awards letter and/or pension -
Why is getting pre-approved for a mortgage important?
A pre-approval letter is a document provided by a licensed loan officer stating that a buyer can afford a property purchase up to a specific amount. Essentially, it answers the question that many sellers have when talking to potential buyers: Are You Good For It? -
When should I get pre-approved?
While it’s never too early to start speaking to a mortgage professional about home financing, we advise getting pre-approved when you’re ready to start seriously looking at homes. You don’t want to scramble for a pre-approval after you find a home that you want to make an offer on… but keep in mind that pre-approvals last for four months (assuming there aren’t dramatic changes to income or your debt). So, if you find a property five or six months down the road, the lender will have to re-pull your credit, and that will be another hard inquiry. -
What are Mortgage Points?
Mortgage points are fees that are paid to the mortgage lender for a lower interest rate…hence the phrase: “buying down the rate”. Which explains why mortgage points can sometimes be referred to as “discount points”. -
If I’m still saving for my downpayment, when should I get pre-approved?
Generally, pre-approvals last for three months, assuming there aren’t dramatic changes to income or your debt. If, for example, you find your property five or six months after the initial pre-approval, a lender will have to re-pull credit, and that will be another hard inquiry, which is not ideal. -
Should you use a Mortgage Broker or a Bank?
Unless your bank is able to offer a significantly lower interest rate, we recommended minimizing your stress and using a mortgage broker. No matter what, research reviews of your mortgage provider. It will give you some much-needed peace of mind as you navigate your home purchase. -
How best to reduce the amount of interest charged through the life of a loan?
It would be best to start prepaying as soon as you can. The way amortization works is that interest is front loaded in the early months. So the sooner you can start knocking out that principal, the better. -
Are mortgage interests rates lower when purchasing a primary residence?
Primary residence purchases will typically have lower interest rates. A second home or investment property will almost always have higher interest rates. -
Should I refi to save $100/month?
Much of this decision depends on the breakeven point – which is when your $100 per month in savings equals the closing costs for the refi. Additionally, compare how much of the new payment will be going towards principal vs the existing because that determines the lifetime of the loan. -
Can I do a cash out refinance while a home is undergoing significant renovation?
Getting an appraisal during a renovation, is not advisable since the goal is to achieve the highest appraisal value possible in order to lower the loan to value (LTV) for a refinance. Unfinished construction projects will not help the value of the home in these cases. -
What determines if I can do a cash out refinance for my FHA loan while lowering my rate and getting rid of mortgage insurance?
You may be able to refinance out of your FHA loan into a conventional loan. And assuming you have at least 20% equity, you would be able to get rid of the private mortgage insurance. Depending on your credit score and other factors, you may be able to lower your rate, but when you pull cash out on a conventional loan, there is an interest rate adjustment that increases the rates. So you’ll want to talk to a loan officer about your situation.
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The Mortgage
Do’s and Don’ts
- Continue living at your current residence.
- Continue to make your mortgage or rent payments on time.
- Notify your Loan Officer if you plan to receive gift funds for the down payment of your transaction.
- Notify your Loan Officer of any current employment changes: promotion, pay increases, etc.
- Continue to use the same insurance company.
- Continue to use your credit card as you normally would, and try to avoid any large purchases.
- Keep copies of all important financial documents: check/paystubs, W-2s, tax returns, bank/investment account statements, rental agreements, etc. Promptly provide all documents requested by your loan officer to avoid any delays.
- For any documents provided, please provide all pages, even in blank.
- Contact your Loan Officer of any potential changes regarding your employment, credit cards or assets.
- DON’T ~ Make a major purchase (car, boat, etc.)
- DON’T ~ Change jobs without consulting your loan officer. Your lender must verify your employment, so it’s crucial to maintain employment status.
- DON’T ~ Apply for new credit or loans of any kind. Credit inquiries may hurt your credit score, and will have to be explained.
- DON’T ~ Max out or Close credit card accounts. This may increase your debt ratio.
- DON’T ~ Pay off any collections or charge-offs before consulting your loan officer.
- DON’T ~ Consolidate your debt into fewer accounts.
- DON’T ~ Start any home improvement projects.
- DON’T ~ Move/transfer funds between bank accounts without consulting your loan officer.
- DON’T ~ Make any cash deposits or large deposits that are outside of your payroll deposits unless 100% necessary. If you must, save all the documentation showing where the funds came from.
- DON’T ~ Co-sign on another person’s loan.
- DON’T ~ Plan a vacation during your loan transaction without consulting your loan officer.
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