Private Mortgage Insurance – What and When

mortgage insurance

If you are required to have mortgage insurance, you need to understand what it is, why it’s necessary and when it’s required. Mortgage Insurance lowers the risk (to the lender) of making the loan. Basically, it’s an insurance policy for the lender but you, the borrower, pay the premiums. Private Mortgage Insurance = Mortgage Insurance [...]

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Tax and Insurance Impounds – Good Idea or No?

The question of tax and insurance impounds is one I usually get, even from experienced buyers. There are mixed thoughts on the matter. Your payment is made up of 4 components. Principal, Interest, Taxes, and Insurance. If you are required to also have Mortgage Insurance (as opposed to property insurance) then that will be the [...]

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No More Loan Committee

There are a lot of people (yes, and computer programs) behind the scenes who are involved in getting your mortgage approved. A Loan Committee is not one of them. Let’s look behind the curtain to unmask all these ghost people. The following infographic pertains to Mortgage Brokers because they have a choice of hundreds of [...]

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Mortgage Mistake #5 – PreQualification vs PreApproval

pequalification vs preapproval

PreQualification vs Preapproval, what’s the difference? Over the past 30 years, almost every client who has come to me for a purchase loan has asked me what the difference is between a PreQualification and a PreApproval. The distinction is an important one. It can mean the difference between receiving a final loan approval and losing that [...]

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Mortgage Mistake #4-Changing Jobs or Your Business Structure

Mortgage Mistake #4 – Changing jobs or, if you are self-employed, your business structure. Scenario 1: You are an employee with a salary If you are an employee who receives a regular paycheck for the same amount each pay period, here’s what happens when you change jobs. The lender who is processing your new loan [...]

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Mortgage Mistake #3-Opening New Lines of Credit

Mortgage Mistake 3 – New Lines of Credit. When you are about to purchase a new home, you think about the wonderful, brand new shiny appliances you’ll get. The furniture that will reflect your personality, the art, the accessories. Mortgage Mistake 3. Don’t! There are multiple reasons for not opening new lines of credit during [...]

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Mortgage Mistake #2 – Waiting Until You Can Make a 20% Down Payment

An even bigger mortgage mistake is waiting until you have enough money for a 20% down payment. It’s true that when your down payment is less than 20%, your mortgage will cost you more, but if you wait, the financial benefits you realize by owning rather than renting will be overshadowed. Here’s what I mean. [...]

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Mortgage Mistake #1 – Don’t Move Money Around

billy_g mortgage mistake

It’s not the house hunt that scares buyers off, it’s applying for a mortgage. It’s easy to mess up. Today is Mortgage Mistake #1 of a 5-part series. Mess up #1 – Moving money from one account to another. Many of you have heard that if you move your home-buying funds from one bank account to another [...]

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Mortgages for Self-Employed Borrowers

self-employed

Mortgages for self-employed borrowers. What does that mean? If you are a self-employed borrower, is it more difficult to get a mortgage? Let’s first look at the definition of self-employed. Mortgage lenders and tax preparers look at that term differently. Maybe you work under your own name or a DBA (Doing Business As), and your [...]

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Does All the Conflicting Credit Score Information Give you a Headache?

Some people think I’m too much of a fanatic about keeping credit scores high, (or getting them up there), but I know what a huge difference a great credit score can make in your day-to-day existence. If you buy or lease a vehicle, the total interest you pay varies by many thousands of dollars. If [...]

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