Your need-to-know info on home financing...
THE BASICS...
Before, or shortly after you begin touring properties you should get Pre-Approved or Pre-Qualified for a home or business loan. This will help you and I when negotiating, and it could make the difference in getting your offer accepted over others!
Many mortgage loan companies will offer you Pre-Approval or Pre-Qualifications over the phone, via e-mail and by appointment. Below are a few recommended mortgage loan officers or assist you in locating another one!
This process saves you the time and effort of looking at homes outside of your price range. It is important to note the difference between Pre-Approval and Pre-Qualification. Pre-Approval is an actual mortgage loan approval based upon your credit report, income and assets. A Pre-Qualification is an educated estimate of what you would qualify for based upon non-verified information supplied by you. If at all possible, a Pre-Approval is the better way to go!
THE DETAILS...
Your credit and financial stability are the biggest factors in financing approval. Based on your particular situation, your loan options generally include:
- Conventional Conforming (20% down, no Primary Mortgage Insurance "PMI")
- Conventional Non-Conforming (5-19% down, PMI generally required)
- Jumbo (loan over $417,000, no PMI if 20% down, higher interest rate)
- FHA (3.5% down, less stringent credit qualifications, property must qualify)
- VA loan (0% down, no PMI, active or veteran military only)
No matter which loan you qualify for and choose, your interest rate and term become the most important numbers to keep an eye on. With interest rates at an all time low, if you have good credit and a stable job you shouldn't expect a rate above 4.51% for a conventional 30-year loan (as of 7/12/2011).
Mortgage "points" are another item to keep an eye on when shopping for a loan. Most reputable lenders and mortgage brokers wont charge you "points" to get a loan and thus avoid any lender or broker trying to convince you they are necessary. There will be fees when obtaining a loan but points are not a requirement. *One point generally equals 1% of your total loan amount and as a result, your fees add up quickly!
The most important part of the financing process is to find someone you are comfortable working with who understands your needs--much like your real estate agent. Remember, your lender is there to serve you, not the other way around!
LENDER/BROKER RECOMMENDATIONS...
If you are looking for a lender recommendation, here are a few. I've used them numerous times with fantastic results. Just mention my Mitchell Greenblatt as the person who referred you. Lawrence Chon can even gauarantee a remarkable 10 day closing!
Janelle Steinberg
Cobalt Mortgage
Seattle, Washington
Office: 206.274.2870
Direct: 425.890.8026
Email: janelle.steinberg@cobaltmortgage.com
Jodiann Longley
Wells Fargo Home Mortgage
Seattle, Washington
Direct: 253.431.8011
Email: jodiann.longley@wellsfargo.com
AFFORDABILITY CALCULATOR...
Use this simple calculator to estimate your basic monthly mortgage payments. If you need a more comprehensive assessment, please give me a call. I will work with you to establish a comfortable budget based on your needs, goals and lifestyle.
*These are estimates only*