One of the determinations lenders must make when evaluating a loan application is whether or not the borrowers can comfortably afford the new monthly payments when taking on a new mortgage. This is done primarily by way of debt-to-income ratios, or simply “debt ratios.” Most loan programs provide guidance on these ratios both in terms […]
Rate and Term, Cash Out and Streamline Refinance Explained
Homeowners know there are different reasons to refinance. When asked why someone is refinancing, the most common answer is “lower rates.” While that’s perhaps the most popular reason there are others, too. Homeowners can refinance to lower a rate but they can also refinance to change the term of the loan. If say, someone is […]
Financing a Vacation Cabin
Thinking about buying your very own log cabin? Many people do right after they rent a vacation property and love the peace and quiet away from city life. They enjoy it so much they decide instead of renting one every year, let’s just buy one of our own! It’s more common than you might think. […]
What’s a ‘Drive-by’ Appraisal?
Lenders pay careful attention to the value of a property as they’re reviewing a home loan application. Loan amounts are set based upon the type of program which establishes a maximum “loan to value” or LTV. Most loans require some amount of down payment ranging anywhere from 3.0% to 5%, although some programs don’t require […]
APR Explained in Everyday Language
There’s quite a bit of information disclosed when you first submit a loan application. You’ll be asked to provide documentation supporting how much money you make each month, how much you’ve made the last two years, how much available cash you have on hand to close a transaction…and that’s just the beginning. Once an application […]
Why Rescission Periods?
Why are there rescission periods? Or maybe first, what exactly is a rescission period, anyway? A rescission period is basically a “cooling off” period in place after homeowners sign loan papers refinancing an existing mortgage. There can be multiple reasons why someone would want to refinance, and most often it’s to get a lower rate. […]
Is Now the Right Time to Refinance Your First and Second Mortgages Into One?
There are several reasons to consider a refinance, there can be more to it than just lowering the rate on a loan. If you’re looking at your mortgage and thinking of refinancing, let’s talk about your options based upon your personal financial situation and not some “model” based upon when it’s a good time to […]
Insider Tips to Help Your Property Appraise
When a lender evaluates a loan application, there really are two separate approvals going on. One is the lender evaluating the applicant. The applicant’s employment and income are reviewed making sure the new loan is affordable. A credit report and credit scores are ordered to make sure the applicant meets the minimum credit standards for […]
Private Mortgage Insurance (PMI) Explained
Sometimes Private Mortgage Insurance, or PMI, gets some bad publicity. Consumers can hear things about how important it is to avoid PMI. Yet that’s not really a fair statement. Some can also say that PMI only benefits the lender and not the borrower. But these statements need to be looked at a little further. Once […]
The Main Difference Between Mortgage Bankers and Mortgage Brokers
For many, a mortgage banker and mortgage broker are the same. They’re really not. They are the same because they’re a source for home financing but how they get a home loan ultimately to the closing table is different. A mortgage banker and broker might sound the same to the everyday consumer but there are […]
