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Churchill Mortgage Corporation 761 Old Hickory Blvd., Suite 400 Brentwood TN 37027 info@churchillmortgage.com www.churchillmortgage.com 1-888-LOAN-200 615-370-8888
Credit ReportA document completed by a credit-reporting agency providing information about the buyers credit cards, previous mortgage history, bank loans, and public records dealing with financial matters. DeedThe formal written document that transfers the rights of ownership and possession (the title) from the seller to the buyer. Discount PointA unit of measurement used for various loan charges; one point equals one percent of the amount of the loan. Down PaymentThe difference between the loan amount and the sales price of the home you are percentagefor example: a 3 percent down payment on a $70,000 home would be $2,100. EquityThe owners interest, or the amount of cash the owner has, realized, paid in, or invested in real estate. Escrow PaymentThe portion of a borrowers monthly payment that is set aside by the lender in an escrow account to pay the taxes, hazard insurance, mortgage insurance, ground rents, and other special items as they come due. FHA LoanA loan that is insured by the Federal Housing Authority. This type of loan is geared toward providing mortgages for moderate to low income families and is subject to the qualifying guidelines set forth by the Federal Housing Authority. Fixed-Rate MortgageThe type of loan where the interest will not change for the entire term of the loan. Good Faith EstimateProvides a breakdown of the estimated closing charges. Home Equity LoanA loan under which a property owner uses his or her residence as collateral and can then draw funds up to a prearranged amount against the property. Interest RateThe percentage of interest charged on the amount of money borrowed. This rate will vary slightly from lender to lender and will vary according to the type of mortgage chosen (30-year fixed, 3-year adjustable, etc.). Now is an excellent time to refinance with rates that are the lowest in over 30 years! Loan-to-Value Ratio (LTV)The ratio, expressed as a percentage, of the amount of a loan (numerator) to the value or selling price of the property (denominator). Usually the higher the percentage, the greater the interest charged. Mortgage BrokerA mortgage broker is different from a single lender/bank in that the broker represents many different lenders in much the same way a travel agent represents many different airlines. Most people cant call a single airline and expect to get a complete picture of all available flights and prices, and yet some people will call a single lender/bank and end up choosing the wrong type of financing which can literally cost them thousands of dollars. A mortgage brokers knowledge and complete view of all financing options can enable people with low incomes, selfemployment, commissioned income, or even credit problems to obtain excellent financing. A mortgage brokers compensation as your consultant (much the same as a travel agent) is a finders fee
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paid by the lender. These lenders always offer better rates and superior prepayment privileges and often shave as much as a half percentage point off the normal market rate. Origination FeeThe fee that the lender charges the borrower to cover the cost of issuing a loan commitment. It pays for processing the loan which includes collecting information about the borrowers creditworthiness and the property. The fee is usually computed as a percentage of the mortgage loan. It usually does not include fees for appraisals, credit reports, inspections, and loan document preparation. PointsAn amount equal to one percent of the principal amount of a note. Loan discount points are a one-time charge assessed at closing by the lender to increase the yield on the mortgage loan to a competitive position with other types of investments. Pre-Paid CostsThese are the costs that cover your escrow account for the future payment of interest, property taxes, and homeowners insurance. Property taxes are set by the appropriate government taxing authority and, unfortunately, are not negotiable. Depending on the regulatory agency (FHA, Fannie Mae, etc.), you will be required to prepay anywhere from 2 to 11 months of property taxes at closing. Premiums for homeowners insurance are set by the insurance company you select, and you are required to pay your first years homeowners insurance plus two additional months at closing. You can usually figure on your prepaid costs being approximately 1 to 1 percent of your loan amount. Private Mortgage InsuranceThis insurance is required for most loans that have a downpayment of 20 percent or less. Private Mortgage Insurance inures the lender in the event that you default on your mortgage payment and the lender is forced to sell your property at a loss. TitleThe evidence of the right to, or ownership in, property. In the case of real estate, the documentary evidence of ownership is the title deed which specifies in whom the legal state is vested and the history of ownership and transfers. Title may be acquired through purchase, inheritance, devise, gift, or foreclosure of a mortgage. Title InsuranceAn insurance policy which protects the insured (purchaser or lender) against loss arising from defects in title. UnderwritingIn mortgage lending, the process of approving or denying a loan based on an evaluation of the property and the applicants creditworthiness and ability to repay the loan. The underwriter analyzes the risks involved and selects an appropriate loan term and interest rate. VA LoanA load that is insured by the Department of Veterans Affairs. This type of loan is available only to veterans and is subject to the qualifying guidelines set forth by the Department of Veterans Affairs.
There are some situations in which a refinancing decision should invariably be made. If you are able to negotiate a no-cost mortgage (you pay no points or closing costs) and if the new mortgage rate is lower than your existing rate, then refinancing your loan may be of financial benefit to you. If the remaining mortgage balance, including points and closing costs, can be refinanced at a reduced monthly payment and still be paid off within your existing mortgage payment term, then refinancing would be advisable. If you need extra cash for a home equity or auto loan and the mortgage rate is lower than alternative loan rates, then refinancing is a viable option. Lastly, you can generally count on it being time to refinance when your new mortgage rate is at least one to two points lower than your existing rate and you plan to stay in your home for at least three to five years. However, sometimes refinancing can be accomplished with a NO RISK REFINANCE that costs no money out of pocket, and ads nothing to the principal balance. Ask your Churchill loan officer about this program.
You need to expect that your home will have to be appraised again and possibly be inspected. Your credit history will be reviewed again, and there will probably be changes in your mortgage and title insurance. Of course, money doesnt just grow on trees; but if it is truly the right time for you to refinance, then with the money you will be saving after 12 to 18 months, you should begin to feel like your money trees are in full bloom!
Dont Lose The Home Of Your Dreams Because You Arent Prepared To Buy!
Recently a couple decided to submit an offer on the home of their dreams. They had looked for months and finally found the one. Before writing the contract, they decided to talk to a Home Loan Specialist to make sure they would qualify for this home. While in the pre-approval process, another contract came in on the property, and it was gone! Avoid these setbacks and get your loan pre-approved before you buy. To obtain your FREE copy of How To Get Pre-approved For A Loan BEFORE You Buy call Churchill Mortgage Corporation:
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