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Financing Your Home Purchase |
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Unless you are in a position to pay all cash for your home, you will need to obtain a home loan (mortgage) to complete the purchase. I will assist you in this process to help ensure that you obtain the financing that meets your needs.
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Being pre-approved for a loan before you submit an offer will put you in a stronger negotiating position and can save time in the loan approval process.
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I can put you in touch with experienced loan officers at leading mortgage companies. Your loan officer will be your principal guide through the financing process.
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Various financing options may be available to you, including:
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Fixed Rate Mortgage
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Adjustable Rate Mortgage (ARM)
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Government-assisted (FHA or VA) financing
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Seller-assisted financing
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You can expect the lender to ask for standard information regarding your income, expenses and obligations.
COMPONENTS OF A MORTGAGE
A monthly mortgage payment can contain several components:
Principal
The original balance of money loaned. As the loan is paid over time, the principal is the remaining loan balance.
Interest
The charge for the use (loan) of money. The interest rate remains constant in a Fixed Rate Mortgage. The rate can vary according to specified guidelines over the life of an Adjustable Rate Mortgage (ARM).
Property Taxes
The county assessor charges property taxes based on the value of your home. Two tax installments are due each year.
Insurance
Protection against loss resulting from certain hazards, such as theft or fire. The standard policy pays replacement costs, minus depreciation based on actual cash value. You will need to obtain homeowners insurance from your own insurance agent.
Private Mortgage Insurance (PMI)
Loans with smaller down payments involve greater risk for the lender, who requires protection in case the loan goes into foreclosure. Without PMI, lenders would be reluctant to offer loans with lower down payments. Anything less than 20% down payment usually requires PMI.
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