The first thing you should do when you are ready to purchase a home is to know what amount you are comfortable with borrowing before you begin your search. It’s a good idea to write down all of your current bills and include what bills you foresee to have with the new home purchase. Doing so will help guide you to finding a home within your budget that you are comfortable with.
You will then want to begin gathering documents you will need for the purchase process. These include W-2 forms, tax returns, current pay stubs, and asset information, such as bank statements. Once you have these gathered, you’ll then want to start shopping for rates. You don’t need to be pre-approved, but it is a good idea so you know you have financing ready.
To begin the pre-approval process, you’ll need to provide the above-mentioned documentation, along with anything else required by the lender. You’ll fill out a lengthy mortgage application, and the lender will then pull credit and evaluate your creditworthiness (i.e., your ability to repay your debt).
After they’ve reviewed your application and documents, they’ll be able to provide you with a pre-approval letter that outlines the amount you qualify for and the terms of the mortgage loan. You are then ready to begin your home search.
The only closing costs associated with a Fixed Rate Home Equity and a Home Equity Line of Credit (HELOC) is the mortgage recording fee for the county in which the property is located. This fee varies by county, so you may check with one of our Loan Officers if you would like to know the exact amount. Please note that a full appraisal fee of $350 may apply if your loan amount is more than $250,000.
When you hear the term “cash out” in regards to a Traditional First Mortgage, you’re hearing about the ability to use the available equity in one’s home. In other words, the borrower receives additional cash that can be used for any reason.
In addition, “cash out” means if the borrower is receiving cash back from the settlement in excess of 2% of the mortgage or $2,000. It can also mean that the borrower is paying off other debt besides the mortgage, even if the borrower is not receiving physical cash.
An "escrow account" is a special account that holds funds owed for property taxes and insurance premiums.
As a homeowner, you're responsible for more than your mortgage payment; you'll need to pay real estate taxes for your property and insurance premiums as well. Your mortgage lender wants to ensure all of these bills get paid, which is where an escrow account comes in.
You'll make payments on your property taxes and insurance each month, and those funds will go into an escrow account. When your insurance or property tax bill comes due, your mortgage lender uses the escrow funds to pay them.
With GOLD's Traditional First Mortgage, your real estate taxes and homeowners insurance will be included in your monthly payment on your Traditional First Mortgage.
A lien is a legal security interest in real estate property, created and publicly recorded until the mortgage is satisfied (i.e., paid in full). The lien is an encumbrance on the property and can prevent the transfer of the property.
When a financial institution is in a first lien position, it means they are in the first position to benefit from any liquidation of the property that secures the loan in the event the loan goes into default. An example of a first lien would be the financial institution who holds the original mortgage on your home.
You may purchase a home in any of the 50 U.S. states to get a Traditional First Mortgage. If you are interested in getting a Home Equity loan, the property must be located in the state of Pennsylvania.
The Rate is the cost you will pay each year to borrow, expressed as a percentage rate. The Rate will be used to calculate your monthly payment toward principal and does not reflect fees or any other charges you may have to pay for the loan.
The Annual Percentage Rate (APR) is a broader measure of the cost to you of borrowing money, also expressed as a percentage rate. In general, the APR reflects not only the interest rate but also any points, mortgage broker fees, and other charges that you pay to get the loan. For that reason, your APR is usually higher than you interest rate.