If you are in need of a new mortgage, refinance loan, or home equity loan in Silver Hill, Maryland, you will need to find a lender to work with. To apply for a loan, it will be necessary to submit various documents. These include your work history, your bank statements, your tax records, your current housing costs, and information regarding other assets you have. A loan application will be filled out and with this information and the other documents submitted your loan officer can determine the amount of loan you will qualify for. Many questions can arise during this process. Your loan officer should be available to answer any question you have.
What could affect your ability to get a mortgage, refinance loan, or home equity loan?
● Credit score: This is an important element. This number shows the lender your ability to pay off debts has been in the past. This past history lets the lender know that you will be a good risk to lend money to. Obviously, the higher your credit score is, the better terms you will get.
● Financial Analysis: Your lender will look at various documents to check your finances. The documents will include your monthly payments along with your taxes, bills, and income. This will show the lender if you will have the ability to make your mortgage payments. The ratio between your income and the outflow of your resources is an important element.
● Liquid Finances: This information will show your lender that you have money available to you at any time.
● Appraisal: A licensed appraiser will need to appraise your home. If you are having this done yourself, you will pay the expense.
What will the interest rate be on the loan?
Your interest rate will depend on what loan type you select. Common loan types include fixed rate, adjustable rate, balloon, and interest only. Most people chose between a fixed rate and an adjustable rate loan. A fixed rate loan may have a higher interest rate but the monthly mortgage payments never change for the duration of the loan. Most fixed rate loans are for either 15 or 30 years. An adjustable rate loan usually offers a lower interest rate at the beginning, but you have the possibility of a higher interest rate as the rate changes at predetermined intervals. These intervals can be at 1, 3, or 5 years. Your mortgage payments can go up or down depending on the interest rate at the end of an interval. Balloon loans have a very low interest rate but have to be paid off in 5 years. If you don’t plan to live in your house for a long period of time, this loan may work for you. You can also pay off this loan by selling the home. With an interest only loan, your mortgage payments for the first ten years only pay the interest on the loan. Obviously, your payments will go up when the principal is added in at the end of ten years. This is another loan that will work well for you if you don’t plan on living in your home for a long period of time.
What happens after my loan has been approved?
After you have received the good news that your loan has been approved, your loan officer will set up closing. At this meeting you will be responsible for paying the closing costs and down payment of your home. This exact figure will be available to you a few days before the meeting so that you can get a certified check for payment. You will also be asked to sign numerous documents at closing. Double check and ask questions about a document before signing it. As you can expect, closing can be a stressful time. It will be helpful if you come prepared.
Whether you are in need of a new mortgage, refinance loan, or home equity loan in Silver Hill, Maryland, one of our loan officers will be able to help. Contact our office today.
