Thinking of buying a home? Getting your first (or even fifth) mortgage can be a daunting and sometimes confusing task. The mortgage world has its own lingo, and rules and regulations have changed so much in the last five years. Plus, the amount of money you have to pay upfront can be stressful. Fortunately ORNL FCU has professional mortgage loan officers on staff to assist you with the mortgage process and make it easier to understand.
Over the decades ORNL FCU's mortgage loans have helped grow home ownership by the tens of thousands here in East Tennessee. Last year alone, ORNL FCU assisted homeowners across East Tennessee by providing over 1,600 mortgage loans. Knowing the ins and outs of the mortgage loan process can help you make better decisions along the way to home ownership. Here are a few tips provided by one of our very own Mortgage Loan Officers, Kyria, to help familiarize you with the mortgage process:
Be upfront and honest with your loan officer.
You may feel like you’re disclosing a lot of personal information when you go through the loan process, but your loan officer needs to know certain things to secure your financing. For example, you’ll need to verify where you’ll get your money for the down payment, closing costs, and monthly mortgage. Your loan officer’s knowledge of these details can help you get the best mortgage product and interest rate for your individual situation.
Know the cost involved in obtaining your mortgage.
Even if you’re approved for 100% financing, you’ll still have some upfront costs on the day of closing. Normally, a 1% origination fee is part of your closing cost, which is customary in the industry to obtain a home mortgage. You can also expect to pay title fees and taxes when obtaining your home mortgage. Although many home loans don’t require a home inspection, most buyers want a thorough understanding of the condition of the home they are looking to purchase. This can cost anywhere from $250 to $500. Plus, home mortgages do require a home appraisal, in which an appraiser assesses the market value of the house. While this fee is considered part of the closing costs, most appraisers require this payment upfront, which costs about $410 when you finance through ORNL. Finally, you will also need to obtain homeowners insurance to ensure you have sufficient coverage on your new home.
Start making a paper trail.
Your loan officer will need to know where your source of income is coming from. Cash can’t be counted as a source of income, because it can’t be verified. And certain limitations are placed on gifted money. For example, if someone wants to give you money for a down payment, they must be a family member. Your ORNL FCU mortgage loan officer can work with you to explain exactly what you’ll need to verify your income.
Do not apply for new credit or let anyone pull your credit score until after your loan is closed.
Although you may be pre-approved for financing, that doesn’t mean your financing is completely secured. Preapproval is based on certain factors, like your credit score at the time your loan application was completed with your loan officer. If those factors change within the loan processing period, you could put your financing in jeopardy.
Avoid using your credit cards while going through the mortgage process.
As mentioned above, your credit history and usage affects your financing. So, even if you’ve planned a vacation during your loan processing period and you pay for that vacation on a credit card, that could affect whether or not your financing goes through. Again, be upfront with your loan officer about those details to prevent any delay in your loan processing.
For more information on getting a loan with ORNL FCU, visit our website or contact a local branch to schedule an appointment with a loan officer. We’re here to provide a solution for your mortgage needs!