A pre-approval gives you an accurate idea of the size loan lenders would be willing to give you and makes you more attractive to the seller. With a quick, online application process, we'll have you ready to go in no time!
Closing costs cover things like the home appraisal, title fees, and loan origination. Generally, you can expect to closing costs to fall between 3-5% of the purchase price.For example, if your loan is $200,000, your closing costs will be about $8,000.
In order to approve your loan application, a lender needs a few documents to review and confirm your identity, income, and overall credit-worthiness. Depending upon your income source(s), these documents may vary a little.Here's a generic list of what you'll need:
If you've found the perfect house but need a little extra boost to cover the cost, gift funds can help get you there. There are a few restrictions but they generally don't cause an issue for borrowers. First, the person/organization providing the gift funds cannot be an interested party in the sale of the home, like a realtor, broker, or builder. Second, the donor will have to provide a gift letter containing some personal details, gift amount, date of funds transfer, and a statement that no repayment is expected. Third, there are limits on the amount that can be given depending on the details of the loan, like the loan product and down payment.
A home appraisal is an estimate of home's fair market value based upon a professional, unbiased opinion. The appraiser calculates this estimate based upon the value of similar homes in the area and an in-person inspection, which protects the borrower from overpaying for a home.Generally, the borrower pays the appraisal fee and can expect to pay around $400.
Improving credit is not a quick fix! This is a very important thing to understand. Depending upon your situation, building good credit can take months or years. Here are a few tips that will help:
Here's a breakdown of how the FICO score is calculated:
Mortgage insurance is payed by the borrowers in order to protect the lender against borrowers who default on their loans and generally costs between 0.5%-1.5% of the loan amount per year.Mortgage insurance drops off once the borrower builds enough home equity through regular payments. Usually, the borrower needs 20% equity in the home before Mortgage Insurance drops off.
