|
 |
 |
 |
 |
 |
|
3544 Monticello Commons - Norcross - GA - 30092 Cell: 678.467.7388 - Other:770.825.0947 - email |
|
|||
|
|
Getting the loan How much money do I need to buy a house?
Lenders and mortgage brokers will tell you that based on your credit score and other information. That information will be included in the Good Faith Estimate. Click on “Lenders” on the left for names of suggested lenders and mortgage brokers.
What information is included in the Good Faith Estimate?
· Total loan amount, Interest rate, Term
· Items payable in connection with the loan
· Title charges
· Government recording and transfer charges
· Additional settlement charges
· Items required by lender to be paid in advance
· Reserves deposited with lender
· Total estimated settlement charges
· Total estimated funds needed to close
· Total estimated monthly payment
What if I don’t have good credit?
Ask lenders about the following programs: MyCommunityMortgage and Flex 100. These mortgage loan programs are designed for people with limited savings for a down payment and/or closing costs, or for those that do not have a “traditional” credit history but can show that have handled credit well. In other words, you may qualify for these programs even if your credit score is low as long as you can show evidence of a good record of payments of rent and utilities.
What are the 5 major steps in the purchase of a home?
A. Getting the loan
B. Finding the home
C. Making the offer
D. Getting the home inspected
E. Closing the transaction
How do I get started?
Gather the necessary documentation, apply for a loan, and make sure that you get a Good Faith Estimate.
What documentation will I need to apply for a mortgage loan?
Bank account statements for the last 3 months
Paycheck stubs for the last 2 months
W-2 Forms for the last 2 years
Income Tax Returns for the last 2 years
Landlord names and telephone numbers, for the last 2 years
In the meantime, what should I do?
Don’t buy a car. Reduce your debt (such as the balance on your car loan or credit cards) as much as possible. Don’t change jobs.
If instead of first approaching lenders you prefer to do some research yourself, here are some suggestions.
How should I start?
Check your credit. Get your credit reports from all 3 major credit bureaus it for free at www.annualcreditreport.com. may get it (one time only) for free at www.eloan.com. Get also your credit score. Probably the best source is FICO. They charge $47.85 which includes FICO scores and credit reports from the 3 national credit bureaus: TransUnion, Experian and Equifax. Go to http://www.myfico.com/Products/FICOThree/Description.aspx
Why should I check my credit?
To find out if there are any errors in your credit report that may lower your credit score. If that is the case, it will give you time to correct the errors, which takes time.
Why is it so important to check my credit score?
The higher your score the lower your mortgage interest rate will be. There is a chart at
http://www.myfico.com/CreditEducation/ that illustrates this.
Otherwise, how do I repair my credit and improve my score?
You will find useful information in the following sources:
How much home can I afford?
To find out, enter the following information: gross annual income, down payment amount, monthly debt, mortgage interest rate, annual property taxes and homeowners insurance in the calculator at http://cgi.money.cnn.com/tools/houseafford/houseafford.html and it will show you the conservative and aggressive minimum home price you can afford.
What will be my monthly mortgage payments?
Fill in the in the loan amount, appraised value, term, interest rate, annual property tax and property insurance in the mortgage calculator at
This will tell you the total monthly payments broken down into: Principal and Interest, Taxes and Insurance as well as mortgage insurance.
Other useful sites are www.hsh.com and www.bankrate.com
What about prepayment penalty?
Make the sure the loan does not have prepayment penalty. In the future, if interest rates drop you may want to refinance. If the loan has a prepayment penalty, it may make it too expensive for you to refinance.
Which will be my initial expenses before closing?
earnest money, about 1% of the price of the home.
inspection, about $300
appraisal, about $350.
Both the earnest money and the cost of the appraisal will be credited to you at closing.
What should I remember?
Once you have been approved for the mortgage loan of your choice make sure that you get the Good Faith Estimate and the Mortgage Loan Commitment.
Why do I need a Mortgage Loan Commitment?
Two reasons. One, because it confirms that you have been approved for the loan, that the lender as committed in writing to fund your loan, subject only that the home must appraise.. Two, because this gives you leverage when you make an offer on a home and the time comes to negotiate with the seller for better terms.
Why does it give me leverage?
The seller prefers an offer from a buyer that presents strong evidence of having been approved for the loan (pre-approved), to an offer that is conditioned upon the buyer’s ability to obtain a loan (pre-qualified). |
|
|
|
3544 Monticello Commons - Norcross - GA - 30092
Cell: 678.467.7388 - Other:770.825.0947 - email |
