From when to start mortgage shopping to what happens at closing. Understand interest rate options, down payment information, how a decision is made, what documents are needed at closing and more.
Yes, we offer mortgage loan options to customers who may not have perfect credit. If you are concerned about your credit, or have other questions about credit, visit our article “ All About Your Credit,” or contact an experienced PHH Mortgage loan officer who can help you find a mortgage loan that fits your unique financial needs.
No, but depending on your income and debt levels, you may need to sell your home before you can close on the new one. Ask one of our experienced loan officers for more information.
Once you have applied for a mortgage, the lender will schedule a property appraisal for the home or property you are considering. You must designate a contact, usually your real estate agent, to give the appraiser access to the property. The appraiser then comes and evaluates the condition of the home – including its structure, electrical wiring, plumbing and more – and sends the results to your lender.
For more information about your appraisal or any other steps in the home-buying process, contact an experienced loan officer at (800) 210-8849 .
The minimum required down payment depends on the mortgage program you qualify for. In general, at least 3.5% of the sale price is required for an FHA or VA mortgage. If you put down less than 20% on a conventional loan, you may need private mortgage insurance (PMI).
Unlike primary homes, however, second homes do not qualify for FHA or VA mortgage financing. Buyers of second homes may be required to contribute a higher down payment for a second home – so be prepared if you are financing a vacation home or investment property.
You may be eligible to incorporate closing costs into your loan, added into either your interest rate or your loan amount. You will still need money for your down payment, but this will help reduce the amount of money you need to bring to the closing. An experienced PHH Mortgage loan officer can help you find the loan that fits your needs, including the amount of the down payment. To discuss down payment options, call (855) 233-9749.
You can find this information out from the home’s seller or your real estate agent and confirm it with the recording office in the county where the property is located. Property taxes are reassessed from time to time, so this amount may change.
You should look for a mortgage before you start looking for a new home. Once you examine financing options and get a pre-approval decision, you'll know how much money you can borrow and what level of home you can afford.
Before you begin looking for your home or property, real estate agents may ask you to get pre-approved. Having a pre-approval letter in-hand can give you an advantage over other buyers who may be interested in the same home – it shows the seller and real estate agent that you're financially ready to buy the home.
Appraisals compare the current market value of your home to other properties in your area that have recently sold. A current appraisal is necessary for the lender to justify the loan amount that you've requested. Note that the appraised value of your home differs from the value used for property taxes, and then be aware that the appraisal is not a guarantee of the home’s value.
Interest rates change based on fluctuations in the market; however, some lending products allow you to “lock in” on a specific rate. With a rate lock, your rate will not change regardless of what happens in the interest rate market, as long as you close on or before the rate lock expiration date.
Yes. There are a number of options that may help you if you do not have much cash to purchase a home.
Consider one of our low down payment programs, which may require as little as 3% for a down payment.If you meet the criteria, you will be offered the option to add your closing costs in to either the loan amount or the interest rate.
If you choose the loan amount option, closing costs will be added to your loan amount. The amount due over the life of the loan will increase, but the amount you need to bring to closing will decrease.
If you choose the interest rate option, the rate for the life of the loan will increase, as will your monthly payment, but the amount of cash you need to bring to closing will decrease.
You can also consider negative points. This means that in exchange for a higher rate, we will contribute funds toward your closing costs.
To discuss strategies and options, call an experienced loan officer at (800) 210-8849.
You will be presented with rate options that apply to your loan type and closing date, which may include:
Rate Lock: Committing to an interest rate. A rate lock can be done only one time. Your rate will not change regardless of what happens in the interest rate market, as long as you close on or before the rate lock expiration date.
Contact an experienced PHH Mortgage loan officer, who will help you decide which option is right for you.
Discount points can be paid by the buyer at closing to reduce the interest rate, while “negative points” can be paid by the lender to offset closing costs, resulting in a higher interest rate. Points are determined as a percentage of your loan amount. For instance, on a $90,000 loan amount, one point equals 1%, or $900. In many cases, discount points are tax deductible, consult your accountant or tax advisor for advice.
Rates are influenced by current market conditions. In addition, your credit history will be evaluated – and good credit is typically rewarded with a lower rate. To learn about credit and its importance in obtaining a mortgage loan, see our article “All About Your Credit.” Also taken into account are factors such as your loan-to-value ratio, your income, your assets and the purpose of the loan.
When you lock your interest rate, you are guaranteed to receive that rate as long as you close your loan by the specified expiration date. If your loan closes after this date, you are no longer guaranteed your locked interest rate. Instead, you will receive the higher of the current market rate or your locked rate. Please note that you cannot receive a lower rate by allowing your lock to expire.
Contact an experienced loan officer for more information about interest rates or options for locking in or protecting the interest rate on your mortgage: (855) 233-9749.