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Mortgage Loan
What do I need to know before applying for my mortgage?
Whether your refinancing your mortgage, purchasing a home or just consolidating debt, we have constructed a comprehensive checklist of items you should consider before making such a big financial decision. The information provided will help you learn about the different loan options that best meets your individual financial needs. The Mortgage Resource Center will also assist you in choosing the term of your mortgage and determine which lenders best fit your needs. Lastly, we will give you details about the mortgage loan process so you are better prepared. With this information, we hope you find the most cost effective mortgage package for your needs.
Types of Loans
Many factors determine what type of loan you should apply for, including the value of the property, the amount of your down payment, and your credit score.
What types of loans are available to me?
- Conventional Mortgage Loans
- Fannie Mae
Fannie Mae is the common name of the Federal National Mortgage Association. Fannie Mae is a congressionally chartered, shareholder-owned company that buys mortgages from lenders and resells them as securities on the secondary mortgage market. Before approving you, Fannie Mae looks at a number of factors including credit ratings, debt ratio, and employment history. Loans that are approved via Fannie Mae should qualify for a better rate.
- Freddie Mac
Freddie Mac is the common name for the Federal Home Loan Mortgage Corporation. The 2003 maximum loan amount for both Fannie Mae and Freddie Mac is $322,700. Freddie Mac does not issue mortgages directly; rather, they buy mortgages from lenders and sell them as securities on the secondary mortgage market. Before approving you, Freddie Mac looks at a number of factors including credit ratings, debt ratio, and employment history. Like Fannie Mae, loans that are approved via Freddie Mac should qualify for a better rate.
- Non-Conforming Loans
- Jumbo Loans
Conventional loans that are too large for government agencies are called jumbo loans. Currently, any loans over $322,700 are classified as jumbo loans. Jumbo loans have higher interest rates than conforming loans - typically 0.5 percent to 1 percent higher. Jumbo loans also may have higher down-payment requirements.
- Bad Credit Loans
If you've had credit problems in the recent past, lenders consider you a higher risk borrower. In such circumstances, the credit decision includes factors beyond credit scores and credit history, often including employment, income, expenses, assets and other factors as considerations.
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