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FAQ Search
FAQ
Q1: Should I refinance now?
Q2: Should I refinance from an adjustable-rate to a fixed-rate mortgage?
Q3: How much are closing costs?
Q4: Can I finance all of my closing costs?
Q5: Do I need to pay an Origination Fee?
Q6: Are rates going up or down?
Q7: Is my credit excellent, good, fair, or poor?
Q8: How do I determine the current value of my home?
Q9: What is the best way to compare rates from lender to lender?
Q10: How long will the loan process take?
Q11: May I pay my own taxes and insurance?
Q12: What is PMI?
Q13: Is there an alternative to paying PMI?
Q14: Since I
Q15: May I Refinance for more money than I owe to use for home repairs or improvement?
Q16: May I use a cash-out refinance to pay other bills?
Q17: Are interest rates higher for a cash-out refinance?
Q18: How do I receive up to three loan quotes?
Q19: Is there an obligation to accept any of the lender(s) offers?
Q20: Will the lender(s) require any more information than I have already provided here?
Q21: How does the loan process work?
Q22: Will you share or sell my information?
Q23: What are the requirements for VA loan eligibility?
Q1: Should I refinance now? (top)
A1: If you have been living in your home for a while, it might be the right time to consider refinancing your mortgage. There are many good reasons to consider
refinancing, including lowering your interest rate, consolidating your bills, shortening your loan term to reduce interest charges, switching from an adjustable to a fixed rate, or taking advantage of your home's equity.
Q2: Should I refinance from an adjustable-rate to a fixed-rate mortgage? (top)
A2: It will depend on your own, unique situation. Generally, it's always a good idea to get the lowest fixed-rate possible. However, if you're in the first or second year of a five-year adjustable rate mortgage (ARM), and you plan on moving in three years, it may not make sense for you to refinance. If you have an ARM, but are planning to remain in your home beyond the initial term of the ARM, you will likely want to refinance when you see interest rates start to rise. IMPORTANT: be careful here, as interest rates typically go up much faster than they come down. For more information on FRMs vs. ARMs, see our article on adjustable vs. fixed rate.
Q3: How much are closing costs? (top)
A3: Closing costs vary from state to state, and title insurance varies from area to area. These variances, along with your loan balance, will affect your final closing costs.
Q4: Can I finance all of my closing costs? (top)
A4: Most lenders allow you to finance closing costs into your new mortgage loan as long as there is enough equity in your property. You may also pay a higher interest rate to cover your closing costs.
Q5: Do I need to pay an Origination Fee? (top)
A5: The origination fee is a percent of the loan amount and covers the cost of processing and closing your mortgage loan. An origination fee can be waived as lender paid with a higher interest rate.
Q6: Are rates going up or down? (top)
A6: This is the million-dollar question! The bond market changes twice daily. No one can predict fluctuations in the bond market and therefore cannot predict which way rates will go.
Q7: Is my credit excellent, good, fair, or poor? (top)
A7: An individual with excellent credit most likely has a long term positive credit history with no late payments and no charge offs with multiple credit cards, car loans, mortgage, and established lines of credit with no outstanding or ongoing issues; an individual with good credit most likely has no more than one 30 day late payment, no liens, no bankruptcy, no repossession or charge-offs, and has established lines of credit with no outstanding or ongoing issues; an individual with fair credit would likely have one or two 30-60 day late payments on mortgage or credit cards, previously discharged bankruptcy over 2 years, and no more than two charge-offs; an individual with poor credit would likely have little or no established credit history or an established credit history that includes a bankruptcy less than 2 years old, consumer credit account(s) with payments over 60 days late, missed or over 90 day late mortgage payments, liens, repossessions(s), foreclosures, collection issues, or charge-offs.
Q8: How do I determine the current value of my home? (top)
A8: The best way to determine your home
Q9: What is the best way to compare rates from lender to lender? (top)
A9: When shopping for rates, we suggest that you get a Good Faith Estimate from all lenders you are shopping and compare rates and fees (i.e. apples to apples). This ensures that there are no hidden costs or fees and allows for a fair comparison between lenders. You may also want to compare the APR on the Truth in Lending Statement. This indicates the total cost of doing the loan. The lower the APR the less cost associated with the loan.
Q10: How long will the loan process take? (top)
A10: Refinance or debt consolidation loans typically take between 15 to 30 days, depending upon whether you have had a recent appraisal and if there are plenty of comparables in your neighborhood. Often, it is the appraisal that is the lengthiest step in the process. A new purchase loan will take approximately 30
Q11: May I pay my own taxes and insurance? (top)
A11: For FHA and VA loans the government requires the lender to escrow for those fees. On Conventional loans you may pay your own taxes and insurance. However, there is an additional fee.
Q12: What is PMI? (top)
A12: Private Mortgage Insurance (PMI) is a guaranty that protects the lender against loss in the event that the borrower defaults on the loan. PMI is typically required by a lender when the amount borrowed is greater than 80% of the property
Q13: Is there an alternative to paying PMI? (top)
A13: Yes, in recent years lenders have become more creative with financing. In order to eliminate the need to purchase PMI, it is now very common for borrowers to get a 1st and 2nd loan on a property. An example would be as follows: 5% down, 15% 2nd mortgage, plus a 80% mortgage. The benefit of structuring the purchase to include a 2nd mortgage is that the interest can be deducted, whereas PMI cannot be deducted. The end result gives the purchaser more buying power than using PMI. Tip: If you have an institutional lender originate the second mortgage, and not the home seller, be sure to ask the lender to originate two loans simultaneously, so as not to end up paying double closing fees. If you Just be cautious The only negative to this strategy is sometimes the lender ends up charging expenses on both loans, so you pay double closing fees.
Q14: Since I (top)
A14: Yes. A new title search is required to ensure there are no obstacles (liens or lawsuits) to obtaining clear title to the property.
Q15: May I Refinance for more money than I owe to use for home repairs or improvement? (top)
A15: Yes, this is known as a cash-out refinance. However, there must be sufficient equity in the property to cover the cost of the repairs and the property must appraise at an acceptable value before the work has been completed.
Q16: May I use a cash-out refinance to pay other bills? (top)
A16: Yes. Using the equity in your home to pay off other bills can be a smart thing. Consider taking some money out to pay off credit card bills, auto loans and any debt that has interest that is not tax deductible. You may be able to deduct the interest on the money you take out to pay off that debt. Consult your tax advisor to be sure.
Q17: Are interest rates higher for a cash-out refinance? (top)
A17: The interest rate you pay on a cash-out loan will be the same that you pay on a non-cash out loan presuming that: a) the new loan amount is less than 80% of the value of your home; and b) the new loan amount does not exceed the current conforming conventional loan amount of $333,700.
Q18: How do I receive up to three loan quotes? (top)
A18: Unlike most online loan services, with EZloanapply, you can select whether one, two, or three different lenders will contact you. Your loan quote request is delivered to the Lender(s) who is/are most familiar with your location and your specific loan requiements no later than the next business day after you fill out the application.
Q19: Is there an obligation to accept any of the lender(s) offers? (top)
A19: No, there is no obligation to accept any of the offers.
Q20: Will the lender(s) require any more information than I have already provided here? (top)
A20: Most likely yes. The lender will typically need to verify the information that you provided on our website. Some or all of the following information is usually required: Pay stubs, W2s, tax returns, bank account information, and details on your long-term debt (credit cards, auto loans, child support, etc.). A home appraisal will most likely be required as well. If you are self employed you may also be required to provide financial statements for your business.
Q21: How does the loan process work? (top)
A21: The lender you choose to work with will help you to determine the best loan and interest rates available to you after they review your personal information and property. You will receive a list of the documentation needed by the lender to complete your loan. Once the documentation is complete, you will sign your final loan papers and be given a date for when the loan will be completed.
Q22: Will you share or sell my information? (top)
A22: Your privacy and the security of your personal data is of our highest concern. EZloanApply will not sell or share any personal information about you to or with any person or organization other than our accredited broker/lender network.
Q23: What are the requirements for VA loan eligibility? (top)
A23: It seems the general rule of thumb is that you must have served at least 181 days of active duty (90 days during periods of war) and have been discharged under conditions OTHER than dishonorable. If you are or were in the Reserves or National guard, then the general rule for eligibility is completion of 6 years as a member of an active unit, and attendance in weekend drills and 2 week active duty training, and have been discharged under conditions OTHER than dishonorable.
For further information (and to get really confused) visit the VA
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