| WHY
DID MY REALTOR REFER ME TO YOU?
A
high quality realtor knows that the key to a successful transaction
means TEAMWORK with a professional mortgage banker. Any experienced
realtor could tell you horror stories about times when a client
made a poor choice of mortgage company, and ended up with
big surprises at the closing table, or worse, no closing taking
place at all! A good realtor will form relationships with
trusted individuals who have proven themselves time and time
again, so that they know you will be given the excellent service
that you deserve. It is important to know that your realtor
is NOT given any compensation or "kickbacks" for
referring you to a mortgage banker. As mortgage professionals,
we desire more referrals, both from you and your realtor,
so consider the extra motivation this provides for us to take
great care with your satisfaction!
WHY
SHOULD I USE A REALTOR?
First
and foremost, because you need an experienced professional
working on your behalf. The realtor's commission is not paid
by the buyer, but by the seller of the home being purchased,
and it is in each party's best interest to have professional
representation. As a seller, profits are generally maximized
by having an experienced realtor market and sell your home,
rather than deal with the headaches of trying to do it all
on your own. See our page on "selecting a realtor"
for more information.
WHY
AND HOW DO INTEREST RATES CHANGE?
Many
people are surprised to learn that rates change on a daily
and sometimes hourly basis. Interest rates fluctuate in response
to changes in the financial markets. The bond market is generally
a good indicator of the general trend of interest rates.
WHAT
HAPPENS ONCE I AM PREAPPROVED?
You
are ready to buy a home! Remember that it is very important
to inform us of any changes in the financial information that
was provided at the time of approval, as it may make a change
in the amount or type of loan that you can qualify for.
WHEN
SHOULD I CONSIDER REFINANCING?
The
old rule of thumb was at least 2%, but this is no longer the
case. Many different individual factors need to be analyzed
to determine if refinancing is right for you, such as the
length of time you intend to stay in your home, or the type
of loan you currently hold. We are always happy to provide
a recommendation to you for your particular circumstances.
WHAT
IS AN ORIGINATION FEE?
Typically,
it is 1% of your loan amount, and works exactly like a discount
point. You can avoid all or part of this fee by paying a higher
interest rate. In Minnesota, rates are typically quoted assuming
this 1% origination fee.
WHAT
IS TITLE INSURANCE?
It
is a policy provided by the title company guaranteeing the
accuracy of the title work done on your home at the time of
purchase. As a buyer, you are required to purchase a lenders
policy of title insurance as part of your standard closing
costs, which only protects the mortgage company. You may also
choose to purchase an owners policy, which would protect you
against any loss in the event of any legal issues relating
to the title of your home.
WHAT
IS MORTGAGE INSURANCE?
This
is generally required in one form or another when the down
payment is less than 20%, and protects the lender in the event
of loan default. The lower the down payment, the higher the
risk for the lender, and thus the higher the monthly premium.
Depending on your particulars, there are ways in which mortgage
insurance can sometimes be avoided at purchase, or dropped
altogether at some point in the future.
WHY
SHOULD I BE PRE-APPROVED?
Pre-approval helps you determine
A.) What price home to shop for
B.) What loan amount you qualify for
C.) The estimated house payment
D.) How much money you will need to buy a house
E.) What your credit score is
When you are ready to shop for a home you will
have a pre-approval letter to attach to your offer. This will
also let your seller know you are a serious buyer.
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