Your Disclosure Statements include the Loan Estimate, the Closing Disclosure and the Escrow Closing Notice which contain information which Federal and State law requires us to provide to you. The purpose of the Disclosure Statements is to disclose information and details about your loan costs, your Closing Costs and your Escrow Closing Notice and for you to acknowledge your receipt of these disclosures.
Frequently Asked Mortgage Loan Questions
The Annual Percentage Rate, or APR, is the cost of your credit expressed in terms of an annual rate. Because you may be paying points and other closing costs, the APR can be used to provide a method for comparing the cost of credit for different mortgage and home loan programs.
The Amount Financed is your mortgage amount MINUS the prepaid finance charges. Prepaid finance charges include items such as the loan origination fee, commitment fees (points), interest adjustments, and initial mortgage insurance premiums (if applicable). The amount financed is a net figure used to allow you to accurately assess the amount of credit actually given.
No. If your home loan is approved in the amount for which you applied, then this amount will be provided toward your home purchase or refinance at closing.
Mortgage lenders are required by law to provide the information on this statement to you in a timely manner. Your signature is an acknowledgment that you have received this information.
When Drew says 100% Financing or No Money Down, does this mean I will have to pay absolutely no money out of pocket?
Drew Mortgage company offers No Money Down programs to qualified borrowers, meaning you may not have to pay a down payment on the purchase price of the home you’re buying. However, we can’t waive certain closing costs such as appraisal, credit report, home inspection, and prepaid items (taxes and insurance). You may be able to negotiate having some of these fees paid for by the seller. We can help you come up with the best possible deal under these programs.
Your credit score is based on your personal credit history, and can vary depending on how long your accounts have been active, balance in relation to credit limits on credit cards, your history of on-time payments, and any open collection or judgment accounts. Drew Mortgage Associates can provide a free copy of your credit report.
If you are refinancing your home, the average time frame is about 30 days. A home purchase time frame is tied to the closing date set by the seller and the buyer in your Purchase and Sales agreement. We will all we can to make sure your closing takes place as scheduled. Drew Mortgage Associates will endeavor to to expedite your closing for you if you are under a strict timeline.
If you are looking to buy a home, we can give you a mortgage prequalification letter based on your credit report and a review of your preliminary home loan application. This prequalification letter is subject to review based on our receipt and review of various documents required to verify your income, assets and employment, and is not a guaranteed loan approval. A preapproval letter is a firm commitment letter issued by our underwriting department. A preapproval letter may make you a more viable buyer because it indicates that our underwriting department has approved your financing based upon a review of your income and assets documents (subject to an appraisal and a signed purchase & sale contract). Because a preapproval letter assures that you have received financing approval subject to a satisfactory appraisal and execution of a Purchase and Sale Contract, it may induce a seller to accept your offer.
Typically the answer is no, with the possible exception of a deposit that you made to secure the purchase of your home, but don’t intend to apply toward the purchase. Such a deposit refund would most likely occur with a no money down or low down payment loan.
Home inspections are highly recommended but not required by mortgage lenders. The home inspector works directly for you as the buyer, providing a detailed report to inform you if there are any problems with the property. An appraisal is required by lenders to determine the current market value of the property and to ensure that the loan-to-value ratio meets all secondary market requirements.
Because market conditions constantly change, lenders will typically accept an appraisal if it is dated not more than 120 days (approximately four months) to your closing date. After 120 days, a lender will require a new appraisal to reflect current market value.
If I can’t qualify for conventional financing from a different lender, can I still get a loan from Drew Mortgage?
You may qualify for financing from Drew Mortgage. We offer portfolio loans where credit decisions are made in-house using criteria that would not meet normal secondary market requirements. If you have a unique scenario or a low credit rating, we will review financial issues such as compensating factors, and we will use common-sense underwriting to determine if you qualify for to home loan.
No. Drew Mortgage feels that you are more than just your credit score. We review your financial circumstances and credit history to determine if you qualify for financing, and if you do happen to have a low credit score, we will look at underlying issues such as legitimate reasons why you may have had trouble paying your bills in the past as possible mitigating factors that can help earn you an approval for your home loan. Depending on the type of mortgage loan program you’re applying for, Drew will offer competitive rates to all qualified borrowers.
Yes. All mortgage lenders generally require that taxes be paid into escrow at closing. When Drew Mortgage Associates provides financing for your home and your appraisal supports a loan-to-value ratio not greater than 80%, you do have the option to request a waiver of your escrows for taxes and insurance. The waiver is not guaranteed and you may still be required to pay taxes into escrow.
Typically, you can purchase a home with a value of two or three times your annual household income. However, the amount that you can borrow will also depend upon your employment history, credit history, current savings and debts, and the amount of down payment you are willing to make. We have special First Time Buyer Programs.
With a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, in relation to an index. While the monthly payments that you make with a fixed-rate mortgage are fairly stable, payments on an ARM loan will typically change.
An index is an economic indicator that lenders use to set the interest rate for an ARM. Generally the interest rate that you pay is a combination of the index rate and a pre-specified margin.
This is determined based on your borrower profile which includes employment history, credit history, current savings and debt, and other factors. A loan officer at Drew will help you find the best program for your circumstances.
For most homeowners, the monthly mortgage payments include principal, interest, and taxes, and insurance.
The amount of cash that is necessary depends on a number of items.
- Earnest Money: The deposit that is supplied when you make an offer on the house
- Down Payment: A percentage of the cost of the home that is due pursuant to the term your Purchase and Sale Agreement
- Closing Costs: Costs associated with processing paperwork to purchase or refinance a house, as required to be disclosed under federal Truth-in-Lending laws.