Searching for the perfect home in Philadelphia can be a very exciting endeavor, but add in fluctuating mortgage rates and different lenders and the process transforms into a rather overwhelming task. But it doesn’t have to be. As Philadelphia mortgage advisors, we understand the intricacies of the mortgage process and are here to guide our clients through these unchartered waters. Our goal is to streamline each step and provide valuable knowledge, expert guidance and mortgage resources.
Whether you are a first-time home buyer or refinancing your current mortgage in Philadelphia, it is important to also conduct your own initial research, to ensure you are well informed and confident in every decision you make. Here are some common questions to ask your Philadelphia mortgage advisors to help you get started with confidence and ease.
1. What Type of Loans are Best for Me?
With a variety of different loan options to choose from, your Philadelphia mortgage advisors will begin by evaluating your current situation and learning your wants to formulate the best plan for you. Long-term-fixed-rate loans are common with most new homebuyers, however, there are other options available such as adjustable-rate loans, interest only loans, and negative amortization loans. When meeting with your mortgage lender, ask them to thoroughly explain all the loans available to you and what repayment would look like overtime. Getting a complete picture of your loan options, allows you to make an informed and educated decision.
2. What Are the Additional Costs Associated With This Loan?
Most monthly mortgages will consist of three parts: the principal, interest, and taxes / insurance. It is important to discuss with your mortgage advisor the additional taxes and fees included with the loan, to determine if the monthly rate is feasible for you. Each Philadelphia mortgage advisor is different and will be able to offer different rates on loans and the additional fees, so be sure to shop around.
3. What Documents Are Needed to Apply?
Before submitting your application, you will want to discuss with your loan advisor what exactly they will need from you and what the process will entail. Generally speaking for most loan applications you will need to provide proof of identification, detailed financial information, income statements, tax returns, and undergo a credit check.
4. Is Mortgage Insurance Required?
Not all loans will require mortgage insurance. This will change depending on the type of loan and the amount you use for a down payment. When meeting with potential Philadelphia mortgage brokers, ask them to explain your different loan options, detailing which loans will require mortgage insurance and how the insurance is calculated. If insurance is not something you were expecting, ask your mortgage advisor if there are changes you can make to change the need for insurance.
5. Do You Provide Underwriting Services In-House?
Once your Philadelphia mortgage advisor gathers all the necessary documents and information, they will either verify the information in-house or contract the task out to another firm. Be sure to ask your advisor if they will be handling the underwriting in-house and to ask them what exactly that entails and what the timeline is once the documents are submitted. At Federal Hill mortgage, we believe in complete transparency and open communication when it comes to finding you the right mortgage. Walking our clients through each step of the process and making sure they are updated, are two of our top priorities, because we think being in the know is just better.
6. Am I Eligible to Be Pre-Qualified?
In Philadelphia there is currently a shortage of homes for sale, meaning with low supply and high demand, houses go quickly and for higher than asking price. For this reason, you will want to ask your Philadelphia mortgage officer if you are able to be pre-qualified. This process only requires a few financial documents and gives you financial insight into what type of mortgage you can afford. Being pre-qualified simplifies the process once you put an offer on a home.
7. How Much Down Payment is Required?
A 20% downpayment is the usual rate, however, it isn’t always the case. Depending on if you’re well-qualified, you could pay substantially less. You may also pay less if you qualify for government-backed loans such as FHA or VA loans. In some cases though, that may mean you have to find private mortgage insurance and have to pay a higher monthly payment. When meeting with your Philadelphia mortgage officer, it is important to know all your options when it comes to your loan and down payment, so don’t be afraid to ask.
8. What Will My Interest Rate and Annual Percentage Be?
Deciding which mortgage broker in Philadelphia to go with is a very important decision. Each broker will be able to offer you different interest rates and with varying annual percentages (APR). Take the time to consider all the options in front of you and ask your broker for all the information on how the rate was calculated for you and what the monthly payment would be. At Federal Hill Mortgage, we take the time to fully explain to all of our clients the breakdown of the financial part of things so they can choose the best loan that fits their life.
9. How Much Time Should I Expect for Loan Processing?
Each mortgage lender in Philadelphia will have varying loan processing times. The time is affected by what services are available in-house or need to be contracted out, whether all the documents that are needed are present, and other factors like firm resources. As mortgage brokers, we understand at Federal Hill Mortgage that this can be a very stressful time for clients, not knowing what could be coming next. This is why we like to communicate the whole time while we process your loan, so you are always informed and at ease.
Overall, these questions are a great place to start if you are looking for a mortgage broker in Philadelphia. When beginning the home buying process, it is important to first establish what your goals are and to do foundational research so you can meet with prospective mortgage brokers with confidence.
For more information on mortgage advisors in Philadelphia, contact Federal Hill Mortgage. We would love to partner with you for your mortgage journey!