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Frequently Asked Questions

1. How do you qualify for a loan?

The idea of meeting with a lender can be scary, especially if you’re buying your first home. After all, this is probably the biggest purchase you’ll make in your lifetime!

With us, you don’t have to be stressed. Think of your first meeting with a lender as a get-to-know-you session. We simply want to learn a few basics about you and your financial situation.

Then comes the paperwork! Once your loan process gets started, be prepared to provide proof of:

  • Where you work
  • Your income
  • Any debt you have
  • Your assets
  • How much you plan to put down on your home

2. What’s the difference between being prequalified and preapproved?

A quick conversation with your lender about your income, assets and down payment is all it takes to get prequalified. But if you want to get preapproved, your lender will need to verify your financial information and submit your loan for preliminary underwriting. A preapproval takes a little more time and documentation, but it also carries a lot more weight.

Think of prequalification as an initial step and preapproval as the green light signaling that you’re ready to start your home search.

3.How do interest rates affect your mortgage?

High interest rates bring higher monthly payments and increase the overall interest you’ll pay over the life of your loan. A low interest rate saves you money in both the short and long term.

Of course, it’s nearly impossible to time your home purchase with the best interest rates. The past five years have held some of the most affordable interest rates ever.

The money you pay in interest doesn’t ever go toward paying off the principal balance of your home. That’s why it’s a smart move to get a low interest rate on your mortgage and then pay off your house as quickly as you can.

4.What does your mortgage payment include?

Here’s what the typical monthly mortgage payment includes:

  • Principal
  • Interest
  • Homeowners insurance
  • Property taxes
  • Private mortgage insurance (PMI), if you put down less than 20% on your home

If you want to pay more on your mortgage, be sure to specify that you want any extra money to go toward the principal only, not an advance payment that prepays interest.

FAQ