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If you find that your question is not answered on this page, please email us Laura@LauraDose.com Why did my Realtor refer me to you? Why did my Realtor refer me to you? A highly qualified Realtor knows that the key to a successful transaction requires teamwork with a reliable mortgage advisor. Any experienced Realtor could tell you stories of transactions gone horribly wrong due to the inexperience or dishonesty of a less than professional loan officer. The stories end with a dissatisfied client that won’t be returning with their future business. A good Realtor develops relationships with trusted advisors who have proven themselves by consistently delivering excellent service. It is important that you know your Realtor is NOT given any compensation or “kickbacks” for referring you to the Laura Dose team. As mortgage professionals, we desire referrals from both you and your Realtor - We receive those referrals through delivering excellent products and service. What is the difference between pre-approval and pre-qualification? The pre-approval process is much more complete than pre-qualification. For pre-qualification, a loan officer asks a few questions, usually looks at your credit report and provides you with a pre-qual letter. Pre-approval includes all the steps of a full loan approval, except for items specific to the property. Those items include the purchase contract, escrow instructions, appraisal, title report, HOA documents. Pre-approval can make the seller feel more confident that the buyer will not cancel because of a financing contingency, putting the buyer in a stronger negotiating position. What's the difference between a mortgage broker and a direct lender? A mortgage broker counsels you on the loans available from different wholesalers, takes your application, and usually processes the loan which involves putting together the complete file of information about your transaction including the credit report, appraisal, verification of your employment and assets, and so on. When the file is complete, but sometimes sooner, the lender chosen "underwrites" the loan which means deciding whether or not you are an acceptable risk. A direct lender sells their own products with their own organization. Will I save money using a direct lender? Not necessarily. In fact, if you are a reasonably astute shopper, you can often do better dealing with a mortgage broker. Mortgage brokers deal with multiple lenders - typically 20 to 30 lenders - they can shop for the best terms available on any given day. In addition, they can find the lenders who specialize in various market niches that many other lenders avoid, such as loans to applicants with poor credit ratings, loans to borrowers who do not intend to occupy the property, loans with minimal or no down payment, and so on. Using a direct lender that can also broker out loans is the best of both worlds. The Laura Dose team does exactly that! When does it make sense to refinance? It depends a lot on the goals of the homeowner. Some people refinance to take out equity for various reasons. Some do it to lower their monthly payments, or to roll consumer debt into a lower rate financing. Usually people refinance to save money, either by obtaining a lower interest rate or by reducing the term of the loan. Refinancing is also a way to convert an adjustable loan to a fixed loan or to consolidate a first and second loan on the property. The motivation to refinance can be complex. However, you can try this rough method to calculate savings:
Other factors affecting the equation include principal paid, years into loan, amortization span, and the difference of principal reduction rate at differing interest rates. Consult the Laura Dose team to evaluate your specific situation. A rate lock is a contractual agreement between the lender and borrower. There are four components to a rate lock: loan program, interest rate, points, and the length of the lock. What is a full documentation loan? Both income and assets are disclosed and verified, and income is used in determining the applicant's ability to repay the mortgage. Formal verification requires the borrower's employer to verify employment and the borrower's bank to verify deposits. Alternative documentation, designed to save time, accepts copies of the borrower's original bank statements, W-2s and paycheck stubs. What are the other types of loans? Stated income/verified assets: Income is disclosed and the source of the income is verified, but the amount is not verified. Assets are verified, and must meet an adequacy standard such as, for example, 6 months of expected monthly housing expense. What is a good faith estimate? It is the list of settlement charges that the lender provides the borrower within three business days of receiving the loan application. A loan eligible for purchase by the two major Federal agencies that buy mortgages, Fannie Mae and Freddie Mac. The loan limits in the continental United States are $359,650 for a single family house, $460,400 for 2 units, $556,500 for 3 units, $691,600 for four units at present. A mortgage larger than the maximum eligible for purchase by the two Federal agencies, Fannie Mae and Freddie Mac, currently $333,700 for single family properties (see limits above for additional units). What are points? It is an upfront cash payment required by the lender as part of the charge for the loan, expressed as a percent of the loan amount; e.g., "2 points" means a charge equal to 2% of the loan balance. Paying discount points can be a good or a bad thing, depending on factors like rate differences and the length of time one expects to keep a loan. My team and I have spent a considerable amount of time and money developing a program to convey the effects of discount points in any given situation. |
