MORTGAGES AND LOANS

Q. What are the advantages of using a
Certified Mortgage Planning Specialist?

Q. What's the relationship between points and interest rates?

Q. What are the differences between fixed and variable rates?

Q. What is involved in pre-qualifying for a mortgage?

Q. What is involved with refinancing your mortgage?

Q. What are the advantages of using a Certified Mortgage Planning Specialist?
A: Using a Certified Mortgage Planning Specialist provides you with substantial advantages that traditional bank loan officers do not have. These advantages can be seen in four important categories: Training, Product Knowledge,
Customer Service and Pricing.

All mortgage brokers are required by the Federal government to take a 20 hour class and pass a federal and state exam as well as a criminal background check. This certification can be found on the National Mortgage Licensing System website,
www.Mortgage.nationwidelicensingsystem.org.

This is not required of a federally chartered bank loan officer.

Q. What's the relationship between points and interest rates?
A: Points are fees that are paid by the borrower to buy down a lower rate. This does not always make the most sense in
most situations. This is where the expertise of a Certified Mortgage Planning Specialist can help to decide what makes
the most financial sense for the borrower.

Q. What are the differences between fixed and variable rates?
A: A fixed rate is a rate that will not change for the entire time of the loan. An ARM or adjustable rate mortgage is fixed
for a specified time and then may adjust , up or down, depending on the market. ARM's usually have a lower rate of interest
than the fixed rate options. Depending on one's situation an ARM may or may not make sense for the borrower.

Q. What is involved in pre-qualifying for a mortgage?
A pre-qualification can be performed by the mortgage specialist by obtaining a set of information from the borrower such
as credit, income, and assets. From that information a debt to income ratio is calculated to determine what loan amount
a borrower may qualify for.

Q. How do lenders evaluate your credit?
A: This is an area that is forever changing. For the most part the mid FICO score is the most important factor for the
lenders to consider. Second would be length of credit and number of active tradelines. Any late payments, collections or
judgements can have a negative impact as well.

Q. What is involved with refinancing your mortgage?
A refinance is the paying off of an existing loan with a new loan. People refinance to get a lower rate and lower their monthly payment. You may wish to consolidate debt, or need money for renovations. The process is similar to a purchase requiring an approval from the lender based on income, credit and assets as well as the value of the home. The only difference is no
transfer of property between 2 parties.

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Q. What is Title Insurance?
Title insurance is a form of insurance that is designed to protect lenders and property owners from any potential hidden
claims against a property. If, for example, you purchase a home and later someone contends the sale was invalid, title
insurance protects against any possible resulting losses.

Two main types
There are two main types of title insurance. The first is the type that lenders require to take out when you apply for a mortgage to protect themselves against any potential loss on the loan amount as a result of title issues. This insurance expires when the loan is paid off. The second is personal title insurance that is designed to protect you, the buyer, against any such losses. While optional, it is advisable as it protects your own investment interest. Personal title insurance remains in place the entire time you own your property.

Why it's important
Whenever property is bought or sold a title search is conducted to ensure that the person making the sale is the legal owner. Occasionally, however, oversights can occur. Perhaps the owner has unpaid property taxes and the local county has put a lien on the property. Or maybe the property is co-owned by a seller's ex-spouse and he or she neglects to have this person sign the deed transferring the title. In cases such as these, if a dispute occurs because a title search was faulty, title insurance covers the cost of settlement and any ensuing legal fees.

All these questions and more can be answered in more specific detail to your situation with one phone call the Villa Nova Financing Group.