Home Loans, Mortgages and Refinancing
Home Loans and Mortgages
When purchasing your home, Theresa Springer, Senior Loan Officer, will take the time to sit down with you to review the current home loan market situation. The home loan market is very dynamic and conditions are changing constantly, therefore effecting underwriting standards. Theresa will make sure that you are getting the most up to date information so you can make an informed decision regarding your financial well being.
There are three main components that will determine the amount of money needed for closing a purchase home loan. They are as follows:
This is typically a percentage of the home purchase price. Down payments start from 0%, (VA loans and USDA loans) to 3.5% (FHA loans) and go up from there. FHA loans are insured by the federal government and are the only low down payment loans available that are not employment, income or location restricted, such as VA (Veterans Administration) and USDA (United States Dept. of Agriculture) loans, which are guaranteed by the federal government. If you want to put more down you can go to a conventional loan and these allow for the minimum down payment of 3%. You can always put more down, but you should discuss this with your Mortgage Banker to make sure that the amount you want to put down fits in with your overall financial situation. You do not want to run your accounts dry and have no money left at the end of closing.
Remember : Other than VA and USDA loans, when you put less than 20% down you will have mortgage insurance which you can pay monthly, in a lump sum or split it both ways depending on how your loan is structured for your financial situation.
Closing Costs are incurred when closing a home loan. You can have your Realtor negotiate the closing costs to be paid by the seller in full or in part or you must include them in your cash to close. They normally are made up of the following fees:
- Points (discount, origination, broker fees, loan fees).
- Appraisal fees (appraisal and management company fees, re-inspections).
- Credit Report Fees Flood Determination (third party verifies the home location pertaining to floods).
- Tax Service (third party that verifies annually that your property taxes are paid).
- Processing Underwriting Wire Fee Escrow Fees (closing, courier, gov’t charges, remote closing fees).
- Title Insurance (ALTA Extended and Early Issues).
- And other fees associated with your home loan program.
Check out HUD’s Shopping for Your Home Loan: HUD’s Settlement Cost Booklet. This document covers this information as well. You will also receive a copy of it as part of your loan package from Theresa with your loan application package.
Pre-paids are not fees, but loan costs associated with the closing of your home loan. They are usually made up of the following items:
- Property Taxes
- Home Owners Insurance
- Daily Interest through the end of the month in closing
- Impound (aka Escrow or Reserves) Account Set Up for your property taxes and home owners insurance
Keep in mind that, through your purchase negotiations, you can arrange for the seller to pay if not all, then most of these costs. This is something you definitely want to think about as it can lower your cash needed to close, sometimes substantially.
Also, if you do put 20% or more down, you can opt to pay the property taxes and home owners insurance on your own and not have the bank hold the money needed to pay these items annually (or in Washington State, semi-annually).
View our Disclosures page for details on disclosures for various loan types.
Call Theresa Springer (MLO #70667/NMLS #70667) today at 360-798-4161 to see the difference that working with an experienced home loan professional can make for you.
Word on the Street...
"We went through a very challenging purchase where, after accepting our offer, the seller couldn't produce clear title. Theresa's extraordinary knowledge was our greatest advocate - she'd even advised the title company as to what steps needed to be taken. In the end, we walked from that purchase, but Theresa stood by us through it until we eventually found the beautiful home we did ultimately purchase. She's an incredible professional and we can't recommend her strongly enough!" -- Drew & Linda Z.
Testimonials appearing on this site are individual experiences from those who have worked with Theresa Springer. They are individual results and results may vary.