Answers to Some Frequently Asked Financing Questions
Many buyers feel the pressure when trying to secure the best financing option for their home purchase. Getting the facts is the first step to making the right decisions. Here are answers to some frequently asked financing questions.
Q: HOW LONG DOES IT TAKE TO APPROVE A MORTGAGE APPLICATION? A: Usually about 2 to 3 days, although it can take as little as 1 day and longer than 3 days for high ratio transactions. The actual time depends on how quickly the lender can get an appraisal of the property, a credit report and verification of employment and bank accounts.
Q: WHAT DOCUMENTS WILL I HAVE TO PROVIDE? A: Be prepared to provide verification of income (including a pay stub and/or recent tax returns), bank account numbers and details on your long-term debt (credit cards, letter of employment, auto loans, child support, etc.). If you're self-employed, you may also be required to provide financial statements for your business.
Q: COULD ANYTHING DELAY APPROVAL OF MY MORTGAGE? A: If you provide the lender with complete, accurate information, everything should go smoothly.
You may face a delay if the lender discovers credit problems - a history of late payments or non-payment of debts, or a tax lien. You may then be required to submit additional written explanations or clarifications.
You should also be sure to notify your lender if your personal or financial status changes between the time you submit an application and the time it's funded. If you change jobs, get an increase (or decrease) in salary, incur additional debt or change your marital status, let the lender know promptly.
Q: WHEN DO MY MORTGAGE PAYMENTS START? A: Usually about 30 days after closing. The actual date of your first payment will be included in your closing documents.
Q: WHAT'S INCLUDED IN MY HOUSE PAYMENT? A: Principal and interest on your loan. In some cases, the lending institution may require a monthly payment for hazard insurance, mortgage life insurance and/or property taxes.
Q: CAN I PAY THOSE OTHER THINGS SEPERATELY? A: With most mortgages, you can pay your own taxes and insurance if you've borrowed no more than 75 percent of the purchase price or appraised value of your home. Check with your lender to be sure.
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Copyright 2003. Michael A. Reis, Coldwell Banker Platinum Realty, Canada. All Coldwell Banker offices are independently owned and operated. Powered by Look Communications Inc. and compiled by The Corporate Ninja.
Many buyers feel the pressure when trying to secure the best financing option for their home purchase. Getting the facts is the first step to making the right decisions. Here are answers to some frequently asked financing questions.