Homebuying December 21 2017

What Is Mortgage Insurance And How Does It Work?

Putting less than 20% down on your home sounds like a dream…but what’s the catch? You will most likely have to pay mortgage insurance until you reach that 20% threshold. This insurance policy lowers the risk of the lender so that you can qualify for a loan that you might not otherwise be able to get. If you are required to pay mortgage insurance, it may be included in your total monthly payment, in your closing costs, or both. The terms of this policy are dependent on the loan type you are applying for.

Differences in Mortgage Insurance with Loan Type

Conventional Loan

With a conventional loan, private mortgage insurance (PMI) is implemented through a private company. The premium is typically included in monthly payment with little to no closing costs. Your rates will vary based on the down payment amount and your credit score.

Government Loans

Federal Housing Administration (FHA) Loan Mortgage insurance premium is paid to the Federal Housing Administration (FHA) and is required for all FHA loans. It is included in closing costs and your monthly payment. Your rates are the same regardless of credit score, but there is a slight increase in price with a down payment of less than 5 percent. US Department of Agriculture (USDA) loan This program is similar to the Federal Housing Administration but can be cheaper. The payment is included in closing costs and your monthly payment. Department of Veterans’ Affairs (VA) loan The VA guarantee eliminates a monthly mortgage insurance fee and instead requires an upfront “funding fee”. The amount of the fee depends on criteria based on military service, down payment, and more. With all government loans, you have the ability to roll the upfront or closing cost fee into your total mortgage instead of paying out of pocket. However, this increases both your loan amount and overall costs.

Sources: consumerfinance.gov/

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January 25 2017

Mortgage Tip #3 - You should not buy a vehicle

Applying for any new credit, including one used to purchase a vehicle, could result in inquiries on your credit report. This can lower your credit score, which can affect the amount of money you can qualify for....

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January 25 2017

Mortgage Tip #2 - Do Not Co-Sign a Loan

When your loan is being processed, it is best not to co-sign another loan for anyone else. This could cause changes to your credit report, causing a negative effect on the closing of your loan. https://eaglehm-2.wistia.com/medias/uyua34ux7z Still have questions?...

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January 25 2017

Mortgage Tip #1 - Do Not Change Jobs

It is important that the lender knows you are reliable and have a steady income. One way of proving this is to not suddenly change jobs. Since employment verifications happen within five days of closing, it's best not to make any large lifestyle changes...

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January 24 2017

Breaking Down Your FICO Score

Most people are familiar with the FICO score version of the credit score. Scores on the FICO scale range from 300 to 850. However, there isn’t just one credit score range to go by. There are different types of credit scores, and each of them has its own...

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January 20 2017

Tips on Buying in a Tight Market

Increase your chances of getting your dream house instead of losing it to another buyer, with these easy steps. Get prequalified for a mortgage. You'll be able to make a firm commitment to buy and make your offer more desirable to the seller. Stay in close...

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January 20 2017

Tips for Finding the Perfect Neighborhood

The neighborhood you choose can have a big impact on your lifestyle, safety, available amenities, and convenience all play their part. Make a list of the activities, movies, health club, church you engage in regularly and stores you visit frequently. See how far...

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January 20 2017

4 Tips to Getting Your Finances in Order

The beginning of a new year is the perfect time to improve your finances, even though it may sound like a dull task. For some, the idea of sorting out their finances isn’t very appealing, but it can help set yourself up for a solid financial...

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January 14 2017

What Is a REALTOR?

A real estate agent is a REALTOR when he or she is a member of the NATIONAL ASSOCIATION OF REALTORS, The Voice for Real Estate -- the world's largest professional association. The term REALTOR is a registered collective membership mark that identifies a real...

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January 14 2017

What Your Home Inspection Should Cover

Siding: Look for dents or buckling Foundations: Look for cracks or water seepage Exterior Brick: Look for cracked bricks or mortar pulling away from bricks Insulation: Look for condition, adequate rating for climate Doors and Windows: Look for loose or tight...

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