What is the difference between 0 point and no cost mortgage?

With no cost mortgage, a borrower has accepted a higher interest rates, with the trade off that the lender or broker will pay for all their non-recurring closing costs. With 0 point mortgage, a borrower has opted not to pay points to buy their interest rates down but will still be paying for their base closing costs.

What should I get in writing when getting a loan?

If your loan is primarily for personal or family needs, the lender is required to give you a disclosure form before you sign the documents.This disclosure form should tell you the actual cost of the loan. It should include the finance charge, the annual percentage rate and the all the other fees included.

Why do I need to pay for another policy of title insurance when we already own the property?

Before closing your new mortgage, your new mortgage lender must be certain that the title to the property will be free and clear, free of prior defects and indebtedness. A new policy is needed to protect the new mortgages lender and subsequent investor of your new mortgage. Both a homeowner and prospective lender need to be certain that what is available on the property is what is referred to as a "marketable title". A title company researches the legal history of the property that entails searching public records in the offices of the county recorder. Problems with the title could threaten the mortgage, limit ones use and enjoyment of the property and could result in financial loss. A policy of title insurance protects a homeowner's title and the insurer covers the cost of any legal challenges.

What paperwork will the lender need to process my mortgage?

The answer depends upon the quality of your credit and the amount of equity you have in your property. On a typical fully documented house mortgage application (where an applicant is seeking to qualify based on an employee's salary), the mortgage lender will require: one month's current pay stubs, W-2's for the prior two years and bank and investment account statements for the prior 2-3 months. If an applicant is self-employed then additional documentation could be required

Will the lender require an appraisal of the property?

Yes, the property is the collateral for the morgage, therefore an appraisal is almost always required and if a borrower pays for the appraisal he or she is definitely entitled to receive a copy of it.

Is Home Mortgage Refinancing the right option for me?

Look at your mortgage related goals: are you looking to improve your monthly cash flow, reduce your mortgage term, do you need to take out cash utilizing the equity from your home? Obtaining the right mortgage for your particular needs could make sense even when rates are not at their lowest levels. First identify your goal and contact a mortgage professional for suggestions on mortgage programs that would best help you meet your objectives. Then shop for rates after you have selected the appropriate mortgage program.

Is it a good idea to pay points for a lower rate?

If you are refinancing mortgage, paying points is not always your best option. Points paid for refinancing can be deducted only in small amounts from your taxes, so it could take couple of years before you benefit from a lower rate.

How much money can I borrow with home equity line of credit?

Depending on your your income,credit history, and the amount of your debt, home equity lenders could lend you up to 80% of value of your home less the amount owed on your mortgages.

How much Homeowner's insurance coverage do I need to get new mortgage?

A safe bet is to buy a guaranteed-replacement-cost policy that will generally pay out 20-50% more than the face value of the policy to rebuild your home (this is also the preferred policy of mortgage lenders). A replacement-cost policy typically adjusts the amount of insurance each year to keep pace with rising construction costs in your area. It is important to note that local building codes require structures to be built to specific standards which could vary over time, if your home is severely damaged, you may be required to rebuild it to current codes. Even guaranteed-replacement-cost polices do not always cover this expense. However, many insurers offer an endorsement that will pay for the upgrading cost, it is a good idea to consider adding such an endorsement to your replacement-cost policy.

Will my interest rate for second mortgage change?

If your loan is fixed-rate, the interest rate is set for the duration of the loan. Many lenders will offer variable rate mortgages, and these can provide for periodic interest rate changes. If your contract lets your lender adjust the interest rate, make sure to understand when excatly can the lender change the interest rate and if there are any limitations on how much the rate can change.

What is the difference in rate for non-owner occupied vs. owner occupied financing?

Conforming non-owner occupied rates are typically 3/8% higher than owner occupied interest rates. The equity requirement is usually higher for non-owner occupied mortgages as well, typically 20-30%.

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