Most Commonly Asked Mortgage Questions


Various factors such as credit, equity, income and assets determine whether a lender will give you a home loan.

-       It is possible to get a mortgage with no credit history or credit score, but the process could be more challenging to find the right lender and convince them you can repay the loan. You will probably need to provide extra documentation and show a record of paying bills on time.

-       There are loan programs available for first time homebuyers with no credit, but you must be able to afford the upfront costs and monthly mortgage payments.

Great credit is not always required to get financing. A federal government-backed home loan, such as FHA, requires a lower minimum credit score than many conventional loans.

Everyone's situation is a little different, you may have certain debt, or extra income.

Check out the purchase calculator to find out what you are comfortable paying and contact your loan officer to find the right program for your needs.

Federal government-backed home loans require a lower down payment than many conventional loans. FHA offers 3.5% while some veterans can qualify for loans with no down payment. 

A 20% down payment is common to get a mortgage at a good interest rate and it will allow you to avoid mortgage insurance.

-       Closing costs are the fees you will pay for the services and expenses required to finalize a new mortgage.

-       These fees are paid on closing day and typically range 2% to 5% of the amount you are borrowing.

Discuss available options with your Loan Officer to choose the right mortgage program for you.

Discuss the two options with your Loan Officer and decide what is best for you.

1.     A fixed-rate mortgage offers predictability and stability for your budget because the interest rate and monthly payments remain the same for the life of your loan.

2.     With an adjustable-rate mortgage (ARM), interest rates and monthly payments remain the same for a set period, then change periodically. This means your monthly payments can go up or down throughout the life of your loan.

Interest rates can be unpredictable and may fluctuate between the time you file your loan application and closing. If you want to avoid uncertainty and keep the rate already in your mortgage loan offer, then get a mortgage rate lock.

We offer many types of mortgage programs. 

Discuss available options with your Loan Officer to choose the right mortgage program for you.

-       Points are fees used to buy down your interest rate. Each discount point costs 1% of the mortgage loan and typically cuts the interest rate by 0.25%.

-       Buying discount points is optional and normally reduces your interest rate and therefore lowers the monthly payments. Typically, if you sell the home before hitting the break-even point, you will lose money on the discount points you paid.

-       If you get a 15-year term your monthly payments will be higher than with a 30-year term. In return for a 15-year term, you will receive a lower interest rate and pay mortgage debt in half the time which allows you to save thousands of dollars over the life of your mortgage.

-       With a  30-year mortgage you can stretch out monthly payments over a longer period of time and keep more of your monthly earnings. A 30-year mortgage has a higher interest rate than a 15-year mortgage, and you will pay more in interest rather than principal payments.

Documentation that are usually needed:

1.     Bank statements

2.     Paystubs

3.     Tax returns and W2’s

-       Prequalification tends to refer to less rigorous assessments, while a preapproval can require you to share more personal and financial information with a lender.

-       Being prequalified or preapproved is not a guarantee that you will be offered a loan. More information is required before you can be approved and receive an official loan offer.

Think of it as a savings account that is set up and managed by your lender who in turn deposits a portion of each mortgage payment into your escrow account to cover some costs associated with homeownership such as:

-        Property taxes

-       Homeowners insurance

-       Private mortgage insurance

-       Flood insurance

There are a number of reasons that trigger a longer time to close on a mortgage such as:

-       Loan type

-       Stringent underwriting

-       Title-related delays

Ownership of the property will be transferred to the buyer. This includes:

-       Buyer signing all loan documents such as the promissory note and a Closing Disclosure

-       Transferring funds from escrow

-       Providing mortgage and title fees

-       Updating the deed of the house to the buyer’s name

Your mortgage payment may contain five components:

1.     Principal

2.     Interest

3.     Property taxes

4.     Insurance

5.     HOA (may not be applicable)

With a fixed rate loan, your Principal and Interest will remain the same, but your property tax and insurance may change. 

Typically, refinancing is a good idea if doing so will:

-        Save you money

-        Help build equity

-        Pay off your mortgage faster

There are down payment assistance programs available nationwide.

Mortgage rates are constantly changing depending on different economic factors, such as inflation, economic growth, federal reserve monetary policy, bond market and housing marketing conditions. Contact us now at 1-847-797-9500 to have our mortgage specialist help you.

Your loan number is what helps us identify your loan. It can be found by signing into your LoanCare account or on your monthly statement bill.

There are general steps to help raise your credit score:

-       Build your credit file by having a long standing account with major credit bureaus.

-       Pay loans and credit cards on time. Do not miss making payments.

-       Get current on past due accounts.

-       Pay down high balances on revolving credit accounts.

-       Limit the number of times you submit credit applications.

You will still receive a record from the county as a tax bill, but it is getting paid by the funds in your escrow account.

Your lender will issue Form 1098 that reflects mortgage interest paid during the tax year.