Loan Services

Free Prequalification
     Purchase Loans
Second Home Loans
     Investment Property Loans
Fast and Easy Loans
     Jumbo Loans
VA Guaranteed Loans
     Loans for Less Than Perfect Credit
Rate and Term Refinance
     Cash-Out Refinance
Construction Loans/Lot Loans
     2nd Lien Loans
Private Equity Loans

 

Free Prequalification

Before you go shopping for a new home, allow us to set you up for success. We can accommodate your busy schedule with an evening or weekend appointment, and our time and advice is always free. A prequalification meeting will include a discussion of your financing objectives and a review of your credit history. The goal is to identify a price range that makes you comfortable, and outline a loan program that will meet all of your requirements. Before you leave, we will prepare a prequalification letter on your behalf so that you are armed with the tools necessary to make an offer when the right home opportunity arises.
           

Purchase Loans

Find detailed descriptions below of the most popular loan programs for your next purchase or refinance.

FIXED-RATE MORTGAGE
The fixed-rate mortgage has long been the most popular home financing product.  With an interest rate that never changes, it provides stable, predictable monthly payments throughout the life of the loan.  Your monthly payments won’t decrease if market rates go down, but you’ll have the comfort of knowing you are protected if rates go up. If you plan to stay in your home for more than seven years, and prefer the security of stable payments to being at the mercy of the market, a fixed-rate mortgage may be the best option for you.

ADJUSTABLE-RATE MORTGAGE (ARM)
An adjustable-rate mortgage has a low starting rate, so your initial monthly payments on an ARM will be lower than on a fixed-rate loan for the same amount. And because the amount you can borrow is based partly on how much you can pay each month, you may be able to increase your purchasing power with an ARM.

Here's how it works:  

• The interest rate starts out lower than the rate on a fixed-rate mortgage, then adjusts regularly based on market indicators.
• The starting rate stays fixed for between three months and 10 years, depending on the ARM product.
• Most ARMs adjust annually, but some adjust on a semi-annual or monthly basis.
• Individual adjustments are capped at a certain amount, and the rate can never exceed the lifetime cap.

Keep in mind that the interest rate and monthly payments can increase during the loan term. You may get the most value from an ARM if you plan to move before the end of the fixed-rate period, or if you’re buying at a time when rates are relatively high.

INTEREST ONLY MORTGAGE
Interest only mortgages do not include any repayment of the principal portion of the loan for an agreed upon period of time, called the interest only period. This means that during that time (typically 10 years), your monthly payment will consist only of interest. No portion of the payment will go toward the principal balance. At the end of the specified interest only period, your monthly payments will increase to reflect the fully amortized amount owed to the lender for the remaining years of the loan. You might consider an interest only mortgage if you:

• Want to afford more home now
• Know you will need to sell your home within a relatively short period (maybe 2 to 5 years).
• Want a lower initial payment and have confidence that you can deal with a payment increase in the future.

Second Home Loans

Investing in a second home has the potential to pay off in a number of ways.  First, there are the same financial rewards that come with homeownership in general: tax-deductible interest and possible price appreciation.  In addition, most lenders will allow you to finance a second home with the same favorable rates and terms as a primary residence. Like primary purchases,  100% financing is also available on second home purchases, however, a smart financing strategy may be to use the equity you’ve built up in your primary residence as a down payment source. By using an equity line for a 20% down payment from your primary home, you can put the remaining 80% financing on the new property and best position yourself for optimum leverage.

Investment Property Loans

Unlike a primary residence, a rental property typically isn’t an emotionally driven purchase. As an investor, a review of potential profit and loss, risk and reward are essential elements to every transaction.  The two most common factors in real estate investing are cash flow and price appreciation. It is important to discuss your investment goals with your loan officer so that they can help you strategize. Investment property loans are available under most conventional loan programs, but can carry stricter qualification and loan-to-value requirements in comparison to primary and second home loans. A loan commonly requested for cash flow optimization is described below.

OPTION ARM (PICK YOUR PAYMENT LOAN)
A payment-option ARM is an adjustable-rate mortgage that allows you to choose among several payment options each month. This financing may be appealing to an investor looking for a minimal payment up front in order to manage their monthly cash flow. It may also be suitable for an individual with commissioned or other variable income. It is only recommended for someone who understands the complexities of the program, and is not recommended as a long term financing strategy.

The Option Arm allows for you to choose your payment each month from the following options:

• A traditional payment of principal and interest. These payments may be based on a set loan term, such as a 15-, 30-, or 40-year payment schedule.
• An interest-only payment (which does not change the amount you owe on your mortgage).
• A minimum payment (which may be less than the amount of interest due that month and may not pay down any principal). If you choose this option, the amount of any interest you do not pay will be added to the principal of the loan, increasing the amount you owe and increasing the interest you will pay.

The minimum payment interest rate on an option ARM is typically very low (2%, for example). The actual (fully indexed) rate is closer to that of other mortgage loans. Your minimum monthly payments during the first year(s) of the loan are based on the initial low rate, meaning that if you only make the minimum payment, it may not cover the interest due. The unpaid interest is added to the amount you owe on the mortgage, resulting in a higher balance. This is known as negative amortization.  The fully indexed rate is adjustable, sometimes monthly, and so if interest rates go up, your fully indexed payment will too.

Lenders end the minimum option payment if the amount of principal you owe grows beyond a set limit, say 110% or 125% of your original mortgage amount. For example, suppose you made minimum payments on your $180,000 mortgage and had negative amortization. If the loan balance grew to $225,000 (125% of $180,000), the option payments would end. Your loan would be recalculated and you would pay back principal and interest based on the remaining term of your loan. It is likely that your payments would go up significantly.

Fast & Easy Loans

If you’ve built a good credit rating, you can enjoy the benefits of a no hassle, reduced paperwork fast and easy loan. A fast and easy loan allows you to state your income and assets on the application with no timely paperwork verifications needed. You can use this option in combination with a wide range of fixed and adjustable rate loan products for purchasing a primary, vacation or investment home. With good credit, a 680 score or better, the fast and easy loan is a convenient option for self-employed and commissioned homebuyers, or anyone seeking a simplified loan process.

Jumbo Loans

Also referred to as non-conforming, this type of loan exceeds $417,000 for a single family home. Typically a jumbo loan carries a slight interest rate premium of approximately .25% to .375% in comparison to conforming loans. Many lending institutions will lend up to $4 million for qualified borrowers. Like conforming loans, jumbo loans can be offered with a fixed, adjustable rate or an interest only payment schedule.

VA Guaranteed Loans

VA mortgages are insured by the Department of Veterans Affairs, making buying a home easier and more affordable for veterans, reservists, and active-duty service members.  They offer some of the easiest approval requirements of any mortgage, including:

• No down payment requirement, so you can finance 100% of the purchase price
• The option to use gift money or secondary financing
• Flexible credit requirements
• Expanded qualifying ratios

You will need a Certificate of Eligibility to qualify for a VA loan, whether or not you are a first-time user. If you do not already have a certificate, your loan officer can help you with your request. You are eligible for a VA home loan if:

• You have had 90 days or more of active duty service during wartime
• You have had 181 days of active duty service during peacetime
• You were discharged for circumstances other than dishonorable
• You are currently active duty personnel and you meet the above service requirements
• You are the surviving spouse of a veteran who died during service or because of service-related injuries and you have not remarried.

Loans for Less-Than-Perfect Credit

If you’ve had credit problems in the past, there are programs available to you that use more flexible, common sense guidelines to help get you into a home. The credit requirements are less stringent, and 100% financing may be an option with a minimum credit score of 580. These programs will allow you to use alternate credit sources to establish a good credit history despite what your credit report reads.  Alternate credit sources can include, but are not limited to: utilities, cell phone service, etc. Besides the obvious benefits of homeownership, good payment on a mortgage can play a big role in improving your credit score, creating for you an opportunity to refinance into a conventional loan with a better interest rate in as quickly as 6 mos to 1 year.

Rate & Term Refinance

A rate and term refinance loan is most commonly used to improve the interest rate on a current mortgage loan. A refinance opportunity may arise as a result of improved market conditions, or as a result of an individual’s improved credit position. You may also consider a rate and term refinance if you are interested in a new loan program that may provide better terms for your current situation. For example, it is common to refinance for purposes of paying off a house faster or converting an adjustable rate mortgage into a fixed rate loan. Lastly, if your home has appreciated in value, a refinance may allow you to combine a first and second mortgage into one loan, or eliminate your monthly private mortgage insurance payment.

 The interest rate for a rate and term refinance is just as favorable as that of a new purchase loan. You are allowed to pull out cash of up to $2,000, if you choose, without the “cash out” interest rate adjustment (see below.) Ask your loan counselor to help you perform a “break-even analysis” so you can determine if an interest rate reduction or term enhancement is worth the costs of refinancing.

Cash-Out Refinance

A cash-out refinance may also improve your interest rate and loan term, while allowing you to access the equity in your home for another purpose. Cash-out refinances can carry a slightly higher interest rate in comparison to rate and term refinances. This will primarily depend on the loan amount requested in comparison to the home’s value. Your loan counselor will identify these pricing breaks to help you determine your loan amount. Because loan to value ratios heavily impact your pricing and cash out limits, it is helpful to have an accurate estimate of your home’s value upfront. A cash-out refinance may benefit you if:

• You w ant to draw on the equity in the current home to obtain cash for a major purchase or home improvement
• You want to consolidate credit cards, or other high interest loans into one mortgage

It is also a common financing strategy to use the equity in your primary residence as a source of funds for a second home or investment property purchase as lenders generally offer the most flexible rates and terms on primary residences.

Construction Loans/ Lot Loans

Remodeling a fixer-upper, acquiring a lot, and building a new home can all be made easy via construction financing. A construction loan will not only provide enough loan to purchase a property, but also enough to cover all the work to be done. The financing strategy will depend heavily on the project itself and the time requirements involved. A popular construction loan program is described below.

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ONE TIME CLOSE
            A One Time Close Construction Loan can get you both construction financing and a permanent mortgage with only one application process and one closing. The process of applying for construction financing begins just like any other loan, with an analysis of your credit file, income, assets, etc. The next step is obtaining a complete set of plans detailing the design and layout of your home. The plans, along with specifications describing the home’s components, are required prior to ordering an appraisal. The appraisal will determine the fair market value of your home based on the value of the vacant land and the value of the structure. (Note: the appraiser will use the the purchase price of the land versus the fair market value if it has been owned for less than 1 year.)  Payments made on draws during the construction period are interest-only, and the first draw, if desired, can be used for the land purchase. Other features of the one-time close construction loan include:

• Up to 18 months to complete construction
• Rate locked in at closing, with an option to “float down” to a new rate after construction if rates have improved
• Choice of fixed-rate or adjustable-rate mortgage
• Down payments as low as 5% available

2nd Lien Loans

As you repay your mortgage, you will gradually build up equity in your home.  You can borrow against that equity when you need cash, using either a home equity loan or a line of credit. Even if you do not have an immediate need for cash, many equity lines are put in place as a safeguard in case a need arises.

• HOME EQUITY LOANS give you the cash you need as a single up-front payment, which you can repay at a fixed rate.  If you know exactly how much you need to borrow, a home equity loan may be the best option.
• HOME EQUITY CREDIT LINES give you a revolving source of cash that you can draw from as you need to, up to a maximum amount.  The line carries a variable rate with an interest-only option, and you pay interest only on what you actually use, not the total amount of the credit line.

You also may choose to take out a second mortgage if you are looking to buy a home with no money down and would like to avoid private mortgage insurance. This type of financing, referred to as an 80/20 loan, uses a first mortgage for 80% of the home price, plus a home equity loan to cover the remaining 20%. It is an alternative to paying mortgage insurance which is usually required on loans for more than 80% of the home’s value.

Private Equity Loans

A need may arise for a loan that an institutional lender, i.e.; a bank, is unable to approve. Many times this will be because a borrower needs immediate funds and does not have the time to go through a traditional loan process. Other times, the borrower’s credit profile may not fit within traditional bank guidelines. In these circumstances, a private equity loan may be the only solution. Private equity loans tend to be short term in nature, and are funded by private investors. The most important characteristic of the loan file is the value of the real estate collateral. The borrower’s credit file may also be considered, but is not weighed as heavily. These loans are typically issued at much higher interest rates and will carry points and fees in excess of traditional financing. The loans are structured based on a percentage of the “quick-sale” value range of the subject property (the Loan-to-Value ratio), which must typically hover between 60-75%. Cross colaterallitzation and other terms may be considered as all approvals are circumstancial.