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MORTGAGE BASICS
As your trusted mortgage company, Sweeney Mortgage Group is here to help you understand the basics of mortgages. We know that the mortgage process can be overwhelming, which is why we have provided this guide to help you navigate the process with confidence.
Application Checklist
Applying for a mortgage can seem like a daunting and scary process. To help, we’ve created a checklist of things for you to compile, complete and acknowledge before applying. You will need documents such as W2's, Paystubs, Bank Statements, just to name a few.
Credit
Credit history is a recorded file of past and current credit that is utilized to compile a credit score. Your credit score is probably the most important aspect of obtaining a mortgage. It controls the factors to which your interest rate is based. Most mortgage companies will want a credit score above 620, which the best interest rates at 750 or higher.
Closing Costs
A closing cost is a payment required to finalize a home loan and is separate from a down-payment. Closing costs can include items like points (prepaid interest), lender fee's, application costs, title insurance, real estate taxes & others. Closing costs usually range from 1-3% of the overall purchase price of the property. Contact us for a Loan Estimate with a complete list of closing costs.
Appraisals
An appraisal is an estimate of a property’s fair market value and is required by a lender to ensure the loan amount is not more than the property value. Most all properties will need an appraisal for mortgage underwriting. In some instances a Appraisal waiver will be issued but this usually only happens when putting at least 20% down with great credit. The lender orders & handles the appraisal process.
Mortgage Insurance
Private Mortgage Insurance or PMI is insurance that protects a lender from increased risk from borrowers putting less than 20% down on a house. PMI is always on FHA loans regardless of downpayment but only on conventional loans when putting less than 20%.