The state capital of Wisconsin, Madison is home to more than 500,000 people in its metro area. With attractive features like the University of Wisconsin and a low unemployment rate, it is not difficult to see why so many people enjoy life in Madison.
Alternative loans
If you think you need a Madison, WI mortgage or refinance loan, your first step is to choose the right loan product for you. With an average home price around three hundred thousand dollars, the traditional fixed or variable interest rate may not be right for you. Consider these alternatives.
Jumbo loans: A jumbo loan is a nonconforming loan made for properties that are more expensive than most. While it tends to come with a higher interest rate than many loans, if you are looking at a larger than average property, it may be the perfect choice for you.
Interest only loans: An interest only loan is just right for individuals who expect a growing income in the next decade. For the first ten years on this loan, you pay only the interest. After that, though, expect to see a significant increase in payments, as you will be responsible for both the interest and the principal on the loan. Interest only loans are usually for thirty-year terms, and in most cases, the interest rates are adjustable.
Balloon loans: A balloon loan comes with one of the lowest interest rates on the market, which means lower payments for you. The catch with this type of loan, though, is that it hits its full term in just five years, so unless you plan to sell your property or you have a lump sum of money headed your way, this may not be the right choice.
Options ARM loans: An options ARM loan is perfect for individuals who do not like a set monthly payment. Choose from a minimum payment, an interest only payment, a fifteen-year amortized payment or thirty-year amortized payment each month of the loan.
Choosing a lender
When you have chosen the type of mortgage or refinance loan that is right for you, it is time to choose the right lender. Be sure to get someone who has a number of different loans available, as your first choice may not be the best one to suit your needs. For example, perhaps you were considering a refinance with a cash-out option, but you discover that a home equity line of credit better meets your needs. If your chosen lender does not have that product available, you may have to re-qualify with another lender before you can get the cash you need, which can take time. Additionally, you want a lender with low interest rates and low loan costs.
Applying for your loan
When you have found the loan and the lender that match your needs, you will need to put together some documentation for their review. In order to establish your median household income, you will need copies of your federal tax returns for the last two years. In order to establish your employment history, you will need 1099 forms and W-2 statements for the same period of time. Your lender will also want to know you are currently employed, so have pay stubs and bank statements ready. Moreover, you will need copies of cancelled rent and/or mortgage checks for the last two months.
When you have generated all of your paperwork for your Madison, WI refinance, mortgage, or home equity loan, the lender will generate some paperwork too. Expect to see a Good Faith Estimate outlining the closing costs on your loan within three days of your application. You should also expect to see a Truth in Lending Act disclosure arrive to verify your interest rate and the costs involved with that interest rate.
No matter what type of Madison, WI loan you are looking for, we can help. Fill out the form below, and we will contact you right away.
