FHA Home loan

What is an FHA Loan?

An FHA loan is a loan that is insured by the Federal Housing Administration (FHA). It is designed to help people, who are in a lower income bracket, purchase a home. The FHA was created through the National Housing Act of 1934 and is designed as a loan program to assist lenders by offering a federal insurance on home loans. It is important to understand that the FHA does not act as a lender and is not a home builder. It is an insurance program to protect the lender in the case that you are no longer able to make your mortgage payments. Recently, the FHA program has undergone some changes to help people buy a home today as a result of the recession and jump in foreclosures.

FHA Loan Requirements

An FHA loan has to be obtained through an FHA approved lender and there are several FHA loan requirements/guidelines that you should be aware of:

• Credit - The FHA will examine your credit history and you will need to show that your credit is in good standing and that you have a proven record of paying your bills on time.
• Loan checklist - There are several things that you will need to submit to the FHA lender in order to be approved for the loan. You should also plan to pay some money out of pocket for the credit report check and for an FHA appraisal on the property you are purchasing.
• Loan limit - Each state and county has its own lending limits when it comes to an FHA loan so you want to be sure to research the guidelines for your area to see if you can qualify.
• FHA mortgage insurance - Part of FHA loan qualifications call for the necessity of carrying mortgage insurance in case you are no longer able to meet your payments.
• Debt ratio - The amount of money that you can borrow on an FHA loan will depend on your debt to income ratio. This is done to help you avoid purchasing a home that you cannot really afford.
• Closing costs - The details of what you will be required to pay, as part of your closing costs, will vary as each FHA office determines what is appropriate.

FHA Loan Limits

The FHA determines how much you can borrow in your area by examining the median price for the type of home that you are looking at in that specific area. This is why loan limits are different for each area and for each state.

FHA Loan Vs Conventional Loan

• Government insured - the biggest difference between an FHA loan and a conventional loan is the fact that an FHA loan is insured by a government agency which a conventional loan is not.
• Credit history - a conventional loan requires a good credit history and has strict requirements you must meet while an FHA loan is a little more relaxed.
• Down payment - With an FHA loan, you can make a smaller down payment. A conventional loan requires a bigger down payment.
• Mortgage insurance - all FHA approved loans include mortgage insurance. Conventional loans use a separate process and you must qualify for the insurance.

Conventional Loans

What Makes a Loan a Conventional Loan?

A fixed rate or adjustable rate mortgage (ARM) loan is considered a conventional loan if it has no federal government backing. FHA and VA loans are examples of mortgage loans that have government value and these types of loans are called government loans. With a conventional loan, you will have to go through a regular bank, or your local credit union instead of through government supported organizations like Freddie Mae and Freddie Mac.

What Does a Conventional Loan Require?

If you want to get a conventional home loan, you will need to have a significant amount of money saved since they do require a higher down payment. Conventional loan requirements also include a high credit score which can make it difficult for you to qualify for one of these loans if you have ever had a problem with your credit or if you have not simply built up enough credit. Furthermore, a lender might also require you to get private mortgage insurance if you borrow more than 80 percent of the home's value or the purchase price, a term known as loan-to-value ratio.

Conforming vs Non-Conforming Loans

The United States government has put guidelines into place related to conventional loan requirements and other loan requirements. Loans that follow the guidelines set forth by the government sponsored entities, Freddie Mae and Freddie Mac, are considered conforming loans and loans that do not follow these guidelines are called non-conforming loans.
Non-conforming loans that go over the limit set by conforming guidelines are usually referred to as jumbo mortgages. These are generally used for the purchase of luxury homes and banks consider them riskier, which means that you can expect the interest rate on these types of loans to be higher. These loans come in options that include fixed and adjustable rate mortgage programs.

Government Loans

If a conventional loan is not a good option for you, then you will want to look at government loans. These loans are insured by the government and are designed to help people with lower incomes purchase a home. Furthermore, they can be obtained through a large number of lenders and it is a good idea to examine these loans to see if you can qualify for them.

FHA Loan

The FHA loan is the most popular type of loan when it comes to government loans. This loan is insured and guaranteed by the Federal Housing Administration, and requires a much smaller down payment than a conventional loan. If you go with this loan, you should plan to pay for mortgage insurance as it is required.

VA Loan

The U.S. Department of Veterans Affairs backs the VA loan which benefits anyone who has served honorably in the military. These typically involve lower down payments and lower mortgage payments to assist current and former military members in purchasing a home.

USDA Loan

The U.S. Department of Agriculture backs this loan, which helps people in rural areas purchase a home with no money down. These loans are 100 percent financed.

Refinance Investment Property

With investment property loan rates at all time lows, there is not better time than now to refinance an your investment property. There are many benefits associated with investment property refinance. However, as with all financial decisions, you should carefully evaluate your situation before making that choice.

Benefits of Refinancing Investment Property

Lower interest rates

By refinancing your investment property, you can take advantage of the decrease of interest rates, enabling you to pay more money on the principle of your loan.

Greater rental income

Lower mortgage rates for investment property increases your potential to receive more income from the rental fees.

Buy another investment property

Some investment property refinance programs allow you to take money out of the investment home's equity in the form of cash, which you can then use as a down payment for a second investment property.

Pay off mortgage on investment property

Refinancing investment property can help you pay off the mortgage on that property sooner, saving you thousands of dollars in interest fees.

Build equity faster

Changing your investment property mortgage from a 30 year loan to a 15 year loan will help you build equity at a faster rate.

What to Consider When Thinking About Investment Property Refinance

More is required for refinance investment property

Investment property mortgages are thought of as riskier by lenders, and therefore, they may have higher requirements for you to meet, such as a specific credit score, appraisal of the property, higher reserve requirements.

Loan-to-value

Most lenders will only allow you to apply for mortgage as long as it is below 75% of the value of your property. For example, if your investment property has a value of $500,000, then the highest amount you will be able to apply for in refinancing is $375,000. This can hurt you if you owe more than $375,000 on the investment property.

Charge for early repayment

Before you start looking for investment property refinance, it is important to evaluate the terms of your current mortgage to make sure that there are no charges for early repayment of the mortgage.

Investment property loan rates are at their lowest

If you meet the qualifications for refinance, you will benefit from the fact that investment property loan rates are currently at all-time lows and First Rate Mortgage offers the lowest rates in the industry. These conditions make this perfect time to refinance your investment property.

Cash Out refinance adds to your principal

One of the options available for investment property refinance is cash out refinance, which allows you to take cash out of the properties equity. However, before you decide to take this route, it is important to remember that the amount you borrow will be added to the principal of the mortgage for the investment property.

Cash Out refi

When it comes to refinancing your home, you have two choices: rate and term refinance or cash out refinance. A rate and term refinance is a typical refinance process where your mortgage amount remains the same but your interest rate lowers or the amount of repayment time shortens. With cash out refinance, you can use your homes equity to take cash out of your home.

Things to Consider With Cash Out Refinance

Why do you need the extra money? Is it worth the risk of losing some of your home's equity?

• College tuition
• Vacation
• Home renovation or remodeling
• Family emergency
• Investment or to start a business
• Buy a second home
• Pay off other debt such as credit cards and loans with high interest rates

The total owed on your home loan will increase

When you refinance with the cash out option, it is important to remember that you are adding to the amount you already owe on your home. The cash you take out is added to the mortgage balance. This could mean the loan will take longer to pay off.

Your mortgage payment will increase

As a result of the increased mortgage balance, your mortgage payment will also increase, which may hurt your financial situation in the future.

How Does a Cash Out Refinance Work?

Let's say that your homes current value is $600,000 and you owe $300,000. The difference between what is owed on your home and what it is actually worth is your home's equity. For this example, we now know that you have $300,000 of equity in your home.

Now suppose you decide to take out a second mortgage (which is not a cash out refinance). In the above scenario, you open a home equity line of credit (HELOC), which gives you credit in the amount of $200,000. The HELOC is added to the original balance owed on your home of $300,000. You would now owe $500,000 and the equity in your home would decrease to $100,000. Your payment and the term of your first mortgage stay the same.

Now let's pretend you decide to go with a cash out refinance loan and request $200,000. Your original $300,000 mortgage is rewritten to include the $200,000 cash out. The cash out amount is added to the original mortgage making it $500,000.00, thereby changing the payment and the term of the loan. You will also likely have a new lender. The $200,000 is handed to you in the form of cash, giving you the option to use it any way you like.

What You Need to Know About Cash Out Refinance

12 months: In order to be eligible for cash out refinance, the majority of lenders will want proof that you have been in your home for at least 12 months. If you are an investor looking to remove cash out of a home you just purchased, you may have trouble finding a lender willing to work with you unless you can show that you have 25% of the mortgage in equity.

Cash Out without the cash : Even if you are using the money to pay off credit card bills, bank loans, and other financial institutions, it is still considered a cash out refinance.

Exercise caution: You should only refinance your home if you feel this is the best option for you. Remember that the money you receive will need to be paid back and could potentially become a financial burdon later in life.

Is Cash Out Refinance a Good Choice?

Making the decision to take cash out of your home should be heavily evaluated as there are pros and cons to this type of refinance. It depends on how much time you have left on your original mortgage. If you are close to paying off your home, you may want to consider just waiting until the home is paid off so you don't have to refinance the original loan.

Buying an investment property?

Buying an investment property is a good way to prepare for your financial future. It provides a flow of cash in addition to other income through rental opportunities, and can even present certain tax advantages. That being said, it is a decision that should not be made lightly. Investment property also brings additional responsibility and you should be prepared to handle maintenance and repairs. Some investment property may also need renovating, which can dip into your budget and there may be times when the property is vacant between rental agreements.

What Is An Investment Property?

Any residential property can be considered an investment property if you have no intention of making it a primary residence.You may want to purchase a home near your primary residence and rent it on a long term basis to a couple or a family. If you live in an area that experiences a lot of tourism, such as a lake, beach, or a near a ski resort, then short-term vacation rental properties may be the better choice for you. These are residences that are rented for a month or during an entire season and can be quite profitable.

Reasons To Consider Investing In Real Estate

• Return on investment (ROI)

Real estate investing is one of the most stable forms of investing and generally is guaranteed to produce a return on your investment. For example, if you purchase a residence and use it as a rental property for several years and then sell it for more than you purchased it at, you have already made a positive ROI.

• Cash flow

The rental market is experiencing exponential growth and this means that you have greater opportunities for cash flow. Investment property mortgage rates are incredibly low which means that you can use the rental payments to pay for the rental property's maintenance and still make a profit to put into the bank.

• Easier on your taxes

Buying an investment property can actually help you out with your taxes each year because you are using it as a business.This means that any expenses associated with that property are tax deductible: repairs, maintenance, mortgage interest rate, and depreciation.

Things You Should Know When Buying an Investment Property

In order to get the most out of your investment property, here are some factors that you should examine before you decide that investing in real estate is the right choice for you.

• Mortgage payments

Examine your financial situation to make sure that you will be able to cover mortgage payments on the property during those periods of time when it is vacant. Choosing the right type of home loan options will also help.

• Condition Of The Home

Evaluate the condition of the property and options available such as renovating it yourself, hiring a professional to do the job, or focusing on just the interior or exterior of the property.

• Location, Location, Location

Consider who your target renter will be and look for properties that match what they would look for when choosing a place to live. If you are targeting college students, then looking for a property within close vicinity to a university is paramount. In addition, you may also want to consider how close the property is to public transportation, grocery or convenience stores, local nightlife and other amenities that college students use often. Finding a property with a convenient location could mean the difference between renting for a premium price or bottom dollar, as well as how often you can keep it occupied.

Investment Property Financing

When selecting investment property, it is important to remember the 1% rule; the property should rent for 1% of the property's mortgage. Talk to our friendly staff to learn more about our mortgage rates, which are the lowest in the nation.

Buying Your First Home

Buying Your First Home

First Rate Mortgage has been using its knowledge and experience to help first-time home buyers, just like you. we have the lowest mortgage rates in the industry and you will find that our customer service is second to none as we guide you through the steps to buying your first home.

Should You Rent Or Buy?

There are several advantages over renting:

    Tax deductions

    Appreciation of homes value

    Build equity for future

    Increase borrowing power and credit rating

    Freedom: renovate and modify your home to fit your needs

    Security: no worries about rent increases

Things To Consider Before Buying Your First Home

The decision to buy a home is one of the most important decisions you will make in your adult life. Therefore you should evaluate all factors of home ownership, including the potential risks.

Financial responsibility: you will be responsible for the payment of your mortgage for the next 10, 20, or 30 years even if you suffer a loss in income.

Maintenance and repair: as a home owner you assume the financial responsibility for the care of the home Locked into a mortgage: you wont be able to relocate until the home is sold or turned into a rental property. Property tax: this is based on the value of your home and can rise as property values rise.

Higher cost of living: you can expect to spend more money for utilities and general upkeep when owning a home.

Steps To Buying Your First Home

Once you have decided that buying a home is the right choice for you then you should familiarize yourself with the steps of buying a home.

1. Apply For a Mortgage

We offer a convenient online mortgage application that you can fill out directly on our website and submit when you have finished. It's quick and convenient!

2. Get pre-approved:

Receiving pre-approval for a loan gives you bargaining power and speeds up the buying process once your bid is approved. our experienced loan experts can get you started - just give us a call!

3. Make an offer:

Your real estate agent will assist you in deciding how much you should offer to the seller and will represent you in the bidding process. Finding an experience Realtor is key to getting the house of your dreams at the lowest possible price.

4. Submit a good-faith deposit:

A good-faith deposit reassures the seller that you are serious about your intention to purchase the home and gives you an advantage over other potential buyers.

5. Finalize your contract:

Your Realtor will review the contract with you and help you spot any potential risks or mistakes. Always make sure that the seller has fulfilled their part of the agreement before signing.

What You Need To Know About Home Mortgage Loans

Interest rate

There are two types of interests on loans and these are fixed and adjustable rate mortgages (ARMs). Adjustable interest rates can decrease or increase, depending on the market. Several factors influence the interest rate you get, including your credit rating, the amount of your down payment, and the length of the loan.

Discount points

Fees paid to the lender; each point equals to one percent of the amount borrowed and are used to lower an interest rate. It is usually not recommended to to pay discount points if you are staying in your home longer then 5 years.

Origination fees

Fees charged for the creation of the mortgage loan that are typically charged by mortgage companies that use a processor. This fee is usually negotiable for buyers with good credit.

Loan Term

The amount of time you have to repay the loan after buying your first home. Typical loan terms are 10, 15 and 30 year terms with fixed interest rates.

Should You Get Pre-Qualified Or Pre-Approved?

There is a difference between getting prequalified and preapproved for a first time home buyer loan.

A pre-qualification is an estimate of the amount that you might qualify for it is not a guarantee.

Paying off mortgage early? Is it a good option?

One of the best feelings in the world is the moment that you make that last mortgage payment. If you have not given it much thought, here are some things to consider.

Benefits When You Pay Off Mortgage Early

• One Less Bill To Pay

Your mortgage is probably the largest payment that you make each month but once you pay it off, you no longer have to worry about it.

• More Money To Save

Once you pay your mortgage off, you can take that amount and stick it in the bank. Save for retirement, a dream vacation, college tuition for the kids, emergencies, renovation/home repairs, or loss of income.

• Security

Having your home paid off gives you an added sense of security, knowing that it wont be at risk if you should lose your income. While you still have to be concerned with the maintenance and taxes, you wont be facing foreclosure or lose your home if your income decreases.

• Pay Less For Your Home Over Time

Paying off your home early saves you money on the interest you would have paid if you had just paid it off on schedule. Your interest on a 30-year loan can actually add to the amount of your mortgage but by paying your mortgage off faster, you can save thousands of dollars.

• Credit Rises

Any time you pay off a large debt early, your credit rating rises. This can enable you to do other things such as purchase a second home, a vacation home, or buy that boat you want.

How to Pay Off Mortgage Early

The easiest way to lower your mortgage payment is to go through a refinancing process on your home which can reduce your interest rate and redefine the term of your mortgage as well as your overall payment. There are two options when it comes to refinancing rate and term refinance or a cash out refinance.

Pay More Each Month

One of the easiest ways to pay off your mortgage early is to simply pay more on it each month. Even if it is just $100 more a month, it adds up over time.

Refinance Your Home Loan

Another great way to pay off your mortgage is to refinance at a lower interest rate, which lowers your monthly payment. Once your payment is lower, continue paying the same amount you were paying before. This means you didn't increase the amount you spend per month, but you are putting more towards the principle on the house, paying it down quicker than you would have without refinancing.

Make Bi-Weekly Payments

Most people do not realize that they can change from a monthly payment to a bi-weekly payment. Pay half of your regular mortgage payment every two weeks and you actually will end up making an extra mortgage payment at the end of the year.

Thinking of Refinancing? Here Are Some Popular Loan Options

There are three loans that people tend to choose from most often when refinancing their home: 15-year fixed, FHA, and VA loan. Each of these loans has it's own benefits, drawbacks and requirements. If you are confused about any of these options or would like us to explain in more detail.

• 15-year fixed loan: This type of loan enables you to pay off your home in 15 years, saving you thousands of dollars in interest. The payments are higher than with a 30-year loan, but the interest rate is lower.
• FHA loan: An FHA loan is a loan that is insured by the Federal Housing Administration. These loans are designed to assist home owners with a lower income, work with fixed and adjustable rate loans, and are more flexible with their qualification guidelines.
• VA loans: This loan is for individuals who have served in the military. Similar to FHA loans, they more flexible in qualification guidelines and you can choose fixed or adjusted rate programs.  

Lower your interest rate?

Why Refinance To A Lower Interest Rate?

The primary purpose of refinancing your home is to lower your interest rate. There are several reasons why you may want to consider refinancing your home in order to get a lower interest rate. Perhaps you are dealing with an adjustable rate mortgage (ARM) and you want something more stable or perhaps you have a fixed interest mortgage and you want to switch over to an adjustable rate one.

Reduce Monthly Mortgage Payments

One benefit of mortgage refinance programs is the lowering of the monthly mortgage payment. By lowering your monthly payment you can focus on saving more money, paying off other debt, or just ease the strain on your budget.

Repay Your Mortgage Faster

With a lower interest rate, you could actually pay off your mortgage at a quicker rate, putting the money you would have paid on interest to the balance of the loan.

Adjustable Mortgage Rate Is Changing

An adjustable mortgage rate fluctuates with the market and one good reason to refinance for a lower interest rate for home loan is to avoid increases in your payments.

Consolidate Debt (Cash Out Refinance)

Some people choose to get a lower home loan rate so they can consolidate their debt. This is often done through cash out refinance, which allows you to take equity out of your home and turn it into cash, adding the cash out amount to the balance of your mortgage. Consolidating debt enables you to make just one payment a month and pay one interest rate instead of multiple interests. This can be an effective way to eliminate high-interest credit card and other forms of financial debt.

Mortgage Refinance Programs

The type of refinance program you decide to go with will have a large impact on your life. It is important to remember that you should evaluate individual mortgage refinance programs carefully before making your choice.

For example, if you are living in your dream home and have no plans to moveat least for the next 20 years, you may want to look at a 15 year or a 30 year fixed mortgage. These are long-term mortgages that will allow you to spread your payments over a longer amount of time, lowering your interest rate.

Short term loans, i.e.; ARMs and hybrid ARMs, offer lower interest rate plans. Hybrid loans start out as fixed rate mortgages for the first 3-10 years and then transform into adjustable rate loans.

If your home's value has declined but you are still current on your mortgage payments, you may be able to qualify for the HARP 2.0 (Home Affordable Refinance Program). In order to apply for HARP, you will need to submit a loan application. If approved, HARP goes to an underwriter and you will have to pay refinance fees since it is essentially a new mortgage loan.

Want to lower your monthly mortgage payment?

Tired of paying high interest rates and mortgage payments? First Rate Mortgage can help. We offer a number of refinancing options that can help you take advantage of the best refinance rates in the nation. Interest rates are at an all-time low which means that there is no better time to look at restructuring your home loan than right now.

Benefits of Having a Lower Mortgage Payment

Pay off other debt

Many people lower their mortgage payments in order to pay off debt such as high-interest credit cards, bank loans, car payments, and other financial obligations.

Save money

With lower payments, you can put money away for that rainy day, paying for unexpected medical bills or car repairs.

Easier on the budget

The cost of living has increased while job security has decreased. Perhaps you have had to take a cut in pay or you were laid off and your new job does not pay as well. Lowering your mortgage payment can take off some of the financial stress.

Financial freedom

Lowering your mortgage payment can provide a way for you to reach your goal of financial freedom. You can pay more on your mortgage when you can afford to do so, knowing that the extra payment goes directly to your principle instead of to cover the interest.

How to Lower Your Mortgage Payment

The easiest way to lower your mortgage payment is to go through a refinancing process on your home which can reduce your interest rate and redefine the term of your mortgage as well as your overall payment. There are two options when it comes to refinancing rate and term refinance or a cash out refinance.

Rate and Term Refinancing

This is your typical form of refinancing. When you refinance with this option you are restructuring the insurance rate and the term of your mortgage while your mortgage balance remains the same. You are simply taking advantage of the best refinance rates that are now available to get a lower interest or shorten the amount of time for repayment. For example, if you took out a 30 year loan, originally, you could lower your payments by restructuring the loan to a 20-year loan.

Debt Consolidation Loan

A debt consolidation loan, often referred to as a cash out refinance may not be the best option for lowering your payment. This type of modification pays you cash on the equity of your home but the amount that you take out is added to the principal of the loan. This means that, while you will get a lower interest rate, your payment can increase. It is important to examine all facets of this type of refinancing before taking this route.

Home Affordable Refinance Program (HARP 2.0)

HARP is a program designed to help homeowners who have stayed current in their payments, but the value of their home has fallen. If you qualify, you can create a new mortgage for your home, taking advantage of lower interest rates to lower your mortgage payments.  

Buying a second home?

Every summer, you pack the car and head for your favorite vacation location to enjoy the great outdoors, great, food, and summer activities. Renting a house every year can get expensive which is why you may want to look at buying a second home or vacation property.

Benefits of Purchasing a Second Home

Convenience

The second home is always there when you want to use it no more having to make reservations and paying increasing rental fees. You can leave your summer/winter gear at your vacation place instead of having to haul it back and forth.

Income source

Buying a vacation home provides you with an additional source of income because you can rent it out the rest of the year.

Investment

Purchasing a second home is a great investment because it will increase in value over time.

Taxes

Your tax advisor can help you determine if the property taxes and mortgage payments can be counted as a tax deduction.

Things to Consider When Purchasing a Second Home

Additional expense of holding two mortgages: Buying a second home means that you will be paying two mortgages, if you still owe money on your primary home. You should evaluate your financial situation to make sure that you will be able to afford the double payments.

You may be able to use your current homes equity to buy a second home: Depending on how long you have owned your current home, and how much equity you have accumulated, you may be able to get a home equity loan to purchase your second home with. This allows you to use your equity as a down payment for the second home which can decrease the amount of your mortgage.

Location of your second home: When you look for a second home, location should be taken into consideration. Is it within walking distance to a beach, on the lakefront for easy boat access, or somewhere quiet and peaceful? Are there amenities nearby?

What type of second home do you want or need? Evaluate your needs for your second home choice. Are you looking for a condo, a single family home, a duplex, or a town home?

Can You Afford a Vacation Home?

First Rate Mortgage can help you find an affordable mortgage payment for your second home or vacation property. Want to do some research yourself? Feel free to use our mortgage calculators to get a better idea of what you can afford. If you would like a more accurate idea of how much house you can buy, use our instant rate quote form. If you are serious about buying and want to talk to one of our highly trained and knowledgeable staff for a loan prequalification or pre-approval letter, give us a call at 1-877-227-6840 and we'll be glad to get help you get started on buying the vacation home you have always dreamed of. You can always visit our pre qual website at http://www.firstratemtg.com/pre-qualification.php

Buying a home?

Life is always changing. Perhaps you have decided to go back to school, change jobs, move to another state to be closer to family, or you are looking for an upgrade or downgrade from your current home. Whatever the reason, we can help you through  the process of buying a home.

Things To Consider When Buying Your Next Home

Why Do You Need To Buy A New Home?

•     Children leaving the home
•     New job
•     Family is growing larger
•     Looking for your dream home
•     Moving out of the city
•     Moving to the city

What Features and Amenities You Need in Your Next Home?

Plan ahead for your new home by making a list of the features/amenities you want it to have:

•     Number of bedrooms and baths
•     Outdoor features
•     Location near schools, dining, shopping
•     Large open kitchen
•     Central heat and air
•     Garage for RV/boat

What Are The Costs of Selling Your Current Home?

There are several costs that are involved in putting your home up for sale that you should look at before you list it.

•     Cosmetic appeal updating interior/exterior appearance
•     Mortgage with a prepayment penalty
•     Advertising your home for sale
•     Home inspector to check for problems such as pipes leaking, structure/safety issues
•     Real estate commission
•     Moving costs/storage costs

Determine Your Time Frame for Purchasing Your Next Home

Will you have to sell your home before you have the ability to proceed with purchasing your next home, or do you have sufficient cash and credit to proceed while you sell your home?

Important Things To Know About The Mortgage Application

There are four main factors that we will evaluate during your mortgage application process:

Debts/credit history review Your history of payments on credit cards, loans, bills, and other debt sources is examined to determine that you make your payments in a timely manner. We also run a credit report and look at your credit score during this process.

Income sources It is important to include all sources of income on your application such as part-time jobs, commissions, retirement, alimony, child support, investments, overtime, and bonuses. Verify that the income source is stable and will continue to be an income source for a period of three years.

Assets/funds - Assets are needed to cover your down payment and closing costs you will need to show that you have sufficient funds to pay the costs associated with buying your next home on your mortgage application.

Value of property The market value of the property you wish to purchase should be submitted to us. We will need to make sure that underwriting requirements will be satisfied by the home's appraisal.

Can You Afford Your Next Home?

First Rate Mortgage can help you determine what your mortgage payment on your next home will be. Use our mortgage calculators: mortgage calculator with escrow, interest only mortgage calculator and mortgage loan amount calculator. You can also receive a quote through our Get An Instant Quote tool or talk to one of our highly trained and knowledgeable staff for a loan pre-qualification or pre-approval letter.

Our Service Area

Currently First Rate Mortgage is licensed in 7 states - GA, NJ, FL, CA, TX, MN, MD, VA providing a wide selection of home loan programs:

    Fixed Rate

    Adjustable Rate (ARM)

    HARP 2.0

    FHA

    VA Loans

Please visit our website (http://www.firstratemtg.com/) for the updated list of states we are licensed in.

Fixed Rate Mortgage

FHA Mortgage

Conventional Mortgage

Types of Loans

How to get a lower interest rate

Cash out refis

Payoff a mortgage early

Buying an investment property

Buying a Foreclosed Property

Buying a second home

Buying your next home

Buying Your First Home

What to watch out for in a mortgage?

How can I close my loan fast?

How to find the best rates

VA Mortgages

What is a VA Loan?

VA mortgage loans were started in 1944 with the Servicemen's Readjustment Act. Signed into existence by President Franklin D. Roosevelt, the law was aimed at helping veterans of WWII purchase homes, who otherwise, were not able to qualify through regular mortgage loans. Today, the VA loan program helps military veterans, active military members, and sometimes military spouses, purchase a home with little to no money down. The loan is insured by the Department of Veterans Affairs (VA) but it is important to remember that the VA is not a lender and does not act as such. You will need to locate a lender that is approved to work with VA loans such as First Rate Mortgage.

Benefits of a VA Loan

• No private mortgage insurance - Because your VA loan is federally insured, you don't need to pay for private mortgage insurance
• Limited closing costs - The VA loan program prohibits lenders from charging you over a certain amount for closing costs.
• No penalty fees - Under the VA home loan options, you cannot be charged a penalty if you pay off your mortgage early.
• VA assistance - if you run into financial problems later on, the VA program may be able to help you meet your mortgage payments.
• No down payment - if you meet the credit and income guidelines, you may not have to put any money down on your home purchase.
• You can reuse the VA loan program for your next home if you decide to sell your current home.

VA Loan Requirements

In order to qualify for a VA loan you will need to show the following

• The home will be your primary residence.
• A Certificate of Eligibility.
• You are the un-remarried spouse of a military service member who died while in service, is missing in action, is a prisoner of war, or died from a service related injury/disability.
• You have served as a full participating member of the Selected Reserves or National Guard for at least 6 years
• Your credit report. Bad credit can affect your ability to be approved for the VA loan program.
• Proof of stable income.

How do I Get a Certificate of Eligibility?

• Apply through your lender. The easiest way to apply for your certificate of eligibility is to have your lender do it for you. It takes only minutes and can be accomplished online.
• Online/mail. If you have not chosen a lender yet but would like to receive your certificate, you can go to the VA website and apply online or you can mail in the necessary form.