Planning Your Mortgage and Seeking Pre-approval

The Benefits of a Professional Consultant

Choosing the right lender is a key element to managing your mortgage. As a mortgage consultant, my goal is not just to provide you with a loan, but also to help select the one most beneficial to you and your long-term goals, and then, help you manage that debt over time. There are not many lenders out there who provide this type of personalized service.

My job is just beginning when your first loan closes. I will continuously monitor rates on your behalf, and stay in touch with you to make sure we remain on target with your financial goals. 

Seek Pre-Approval

What's the difference between pre-qualification and pre-approval?

      Secure Online Application

Pre-qualification is the starting point in your search for mortgage financing. A quick snapshot is taken which includes income, existing debt, savings, length of employment, etc. All of these factors will then be analyzed to determine your loan eligibility.

Pre-approval is written documentation that shows you have the support of a lender who is willing to finance you. It means an underwriter has reviewed your loan application. Based on your income, debt ratio and savings, the underwriter provides the dollar amount you are eligible to borrow. Now you can shop around for houses that fit into that loan amount category.

Here is the nice thing about the pre-approval: It gives you the leverage to shop as a cash buyer! With a pre-approval in hand, you now have the power to negotiate. The seller will take your offer much more seriously knowing you are already approved by a lender. Pre-approval can also shorten the time it takes to close, making even a lower bid attractive to sellers who are seeking to move quickly.

What will my monthly payments be?

The amount of your monthly payment depends on what loan program you choose. We like to provide our clients with an easy-to-read spreadsheet that narrows their choices down and compares different loan programs that meet both current and long-term goals. You will have the opportunity to select a program you feel comfortable with before you make an offer on a home.

What does it cost to get pre-approved?

Pre-approval is FREE! You have absolutely nothing to lose and everything to gain.

About the Author

Shawn Kaplan is an active, 50 state Licensed loan officer with Access National Mortgage. Email Shawn at skaplan@accessnational.com or call 615-426-3182.

Bonus: Click to get a free, no-obligation rate quote. I love to work with my readers!

Conventional, FHA, USDA...Oh MI!

We compare the differences of each loan types Mortgage Insurance:

Homebuyers often have a lot of questions about mortgage insurance (MI)...and understandably so. With different rules for different loan programs, the details can be confusing.

Here are a few things to keep in mind. All types of MI protect the lender in the event of default, and MI is typically required when homebuyers have less than a twenty percent deposit to put down on a home. There are two main types of MI: an Up Front Mortgage Insurance Premium (UFMIP), which is generally financed into the loan, and an additional monthly mortgage insurance premium (MIP), paid as a part of your normal monthly mortgage payment.

Here are some additional details to keep in mind:

	CONVENTIONAL "MI"	FHA "MIP"**	USDA "GUARANTEE FEE"
Basics	MI can be monthly or all up front	1% UFMIP rolled into loan amount + Monthly Premium	2% UF Guarantee Fee + Monthly Guarantee Fee
Potential Benefits	Upfront MI can save significantly on monthly payments. Conventional MI often has lower monthly payments than FHA.	Income requirements are relaxed compared to conventional MI & USDA. There is more flexibility in credit scores. Seller paid closing costs is allowable up to 6%.	The monthly premium is typically almost 1/4 the cost of FHA.
Potential Pitfalls	Seller paid closing costs is limited to 3% if ≤5% down payment. Credit requirements and income requirements are more stringent.	The monthly premium is typically higher than conventional & USDA.	There are specific geographic and income eligibility requirements. Income requirements are much more stringent than FHA.
Dropping MI	When the value reaches 78% of the original sales price, MI automatically falls off. You can request removal if the principal balance reaches 80% (i.e. accelerated payment of principal or, in some cases via an appraisal of the property showing increased value).	You must meet two tests to drop FHA's MIP: 1. You must PAY the balance down to 78% of the original sale price of the property (you can't just get an appraisal to show equity). AND 2. You must pay the monthly MIP for a minimum of 5 years.	The USDA Guarantee Fee remains on the loan for the entire term. It can never be dropped from a USDA loan until the property is sold, refinanced or the loan is paid off.

** Note that the FHA MIP example is based on a 30 year example. 

If you have any questions about mortgage insurance or anything at all, call me or email me anytime. I’m always happy to help.

About the Author

Shawn Kaplan is an active, 50 state Licensed loan officer with Access National Mortgage. Email Shawn at skaplan@accessnational.com or call 615-426-3182.

Bonus: Click to get a free, no-obligation rate quote. I love to work with my readers!