1. How do I know how much house I can afford? Answer
2. What is the difference between a fixed-rate loan and an adjustable-rate loan? Answer
3. How do I know which type of mortgage is best for me? Answer
4. How much cash will I need to purchase a home? Answer
5. What does my mortgage payment include? Answer
6. Will my Property taxes and Homeowners Insurance be included in my monthly payment? Answer
7. I've heard about "Seller Concessions". What are they and how do they work? Answer

Q : How do I know how much house I can afford?
A : Generally speaking, you can purchase a home with a value of two or three times your annual household income. However, the amount that you can borrow will also depend upon your employment history, credit history, current savings and debts, and the amount of down payment you are willing to make. You may also be able to take advantage of special loan programs for first time buyers to purchase a home with a higher value. Give us a call, and we can help you determine exactly how much you can afford.
 
Q : What is the difference between a fixed-rate loan and an adjustable-rate loan?
A : With a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, typically in relation to an index. While the monthly payments that you make with a fixed-rate mortgage are relatively stable, payments on an ARM loan will likely change. There are advantages and disadvantages to each type of mortgage, and the best way to select a loan product is by talking to us.
 
Q : How do I know which type of mortgage is best for me?
A : There is no simple formula to determine the type of mortgage that is best for you. This choice depends on a number of factors, including your current financial picture and how long you intend to keep your house. One of our experienced Mortgage Product Specialists can help you evaluate your choices and help you make the most appropriate decision.
 
Q : How much cash will I need to purchase a home?
A : The amount of cash that is necessary depends on a number of items. Many borrowers may qualify for loan programs with little or no down payment. However, the more down payment that is available, generally the better terms are for the borrower which may include lower interest rates, lower mortgage insurance and/or qualifing for a shorter loan term. The first step down the road of home ownership is to call us. We will help through the entire mortgage purchase process from pre-qualificaion to closing.
 
Q : What does my mortgage payment include?
A : For most homeowners, the monthly mortgage payments include three separate parts:
  • Principal: Repayment on the amount borrowed
  • Interest: Payment to the lender for the amount borrowed
  • Taxes & Insurance: Monthly payments are normally made into a special escrow account for items like hazard insurance and property taxes. This feature is sometimes optional, in which case the fees will be paid by you directly to the County Tax Assessor and property insurance company.
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    Q : Will my Property taxes and Homeowners Insurance be included in my monthly payment?
    A : Virtually all loan programs require the "Escrowing" of Property Taxes and Insurance in your monthly payment. The exception to this is when a borrower has a significant down payment (20% for a purchase) or equity in their homes (20% of appraised value for a refinance). Depending on the loan product and the borrowers credit profile, it is possible to "Waive Escrows" for a marginal fee to the lender.
     
    Q : I've heard about "Seller Concessions". What are they and how do they work?
    A : Simply put, Seller Concessions is a monetary value that is credited back to the buyer in a mortgage purchase transaction. There is no set amount or standard for how much seller concessions are allowed in a purchase transaction, but the amount of downpayment a borrower/homebuyer has available directly affects the allowable percentage of Seller Concessions allowed. In general, the lower the down payment, the lower the allowable Seller Concessions. Please call us before you begin shopping for your home. We will take you step by step through your loan process so you are a more informed borrower. Knowledge and information are powerful tools for your negotiations.