These rates are updated regulary and are based on national averages. Actual rates will vary based on credit and loan program. Please contact us for actual rates.
What can I do if I only have a small down payment or none at all?
Some loans will allow you to secure just a 5% down payment plus closing costs. Another option is a piggy-back loan where you get approved for the first and second mortgage to avoid PMI. You could also apply for an FHA loan which only requires a 3.5% down payment. However, your interest rate will likely be higher, and you will be required to buy private mortgage insurance (PMI).
What is private mortgage insurance (PMI) and do I need it?
PMI is required if your loan is considered risky by the lender, usually for down payments of less than 20% or poor credit. It protects the lender in case you default on the loan. PMI reimburses the lender if the home's value doesn't cover the loan amount in case of default.
Can I get a loan from the government?
Yes, HUD offers programs like FHA loans, 203(K) loans for fixer-uppers, and options for homes obtained through foreclosure. FHA loans only require a 3% down payment. VA loans are available for veterans and their unmarried surviving spouses.
Do I qualify for a government loan?
VA loans are for military members and veterans, while FHA loans are available through HUD. Both loans guarantee the lender is paid if you default. You need to meet specific criteria to qualify for either loan.
What are fixed-rate mortgages (FRMs) and adjustable-rate mortgages (ARMs)?
FRMs have a fixed interest rate for the loan's life, while ARMs have interest rates that can change during specified adjustment periods.
Is a fixed-rate or adjustable-rate mortgage better?
Fixed-rate mortgages are better when current rates are low because you can lock them in. If rates are high, an ARM might be better as rates may drop over time. Refinancing is also an option later on to take advantage of rate changes.
What goes into closing costs?
Closing costs are typically 3% to 6% of the total loan. They include application fees, appraisal fees, credit report fees, title insurance, survey fees, and attorney costs, among others.
Can I speed up the approval process?
Yes. To speed up the process, get pre-approved, prepare your paperwork ahead of time, check your credit history, and respond promptly to loan officer requests.
What are mortgage brokers, lenders, and loan officers?
Mortgage brokers help find lenders and assist with loan processing. Mortgage lenders are companies that issue loans. Loan officers are employees who help process your loan from start to finish.
What documents do I need when closing a loan?
You need income records (pay stubs, tax returns), bank records, and information about your debts.
Is renting or owning a home more expensive?
Owning a home can be better long-term, but costs increase over time due to interest, taxes, and maintenance. Renting offers flexibility with fewer responsibilities and no maintenance costs.
Should I check my credit before applying?
Yes, checking your credit beforehand allows you to resolve issues and improve your credit score before applying for a loan.
What are conforming and non-conforming loans?
Conforming loans meet Fannie Mae/Freddie Mac standards for loan specs, amounts, and interest rates. Non-conforming loans don’t meet these standards and are usually funded by private lenders with higher interest rates.
Why are they called “Fannie Mae” and “Freddie Mac”?
Fannie Mae and Freddie Mac were created by the government to boost the housing market. They borrow low-interest money and provide it to local banks for affordable housing loans. Fannie Mae and Freddie Mac are responsible for about 90% of the secondary mortgage market.
What are points?
Points are fees based on a percentage of the loan amount. One point equals 1%. Origination points cover loan processing, while discount points are paid to reduce the interest rate.
