Your Property
When you buy or refinance a home, the property is used as collateral for the loan. Here's what the lender is looking for and why.-
What is an appraisal and who completes it?
To determine the value of the property you are purchasing or refinancing, an appraisal will be required. An appraisal report is a written description and estimate of the value of the property. The appraiser will create a written report for us and you will be given a copy of the appraisal promptly upon its completion or three business days before closing whichever is earlier. -
What types of things will an underwriter look for when they review the appraisal?
In addition to verifying that your home's value supports your loan request, we will also verify that your home is as marketable as others are in the area. -
I'm purchasing a home, do I need a home inspection AND an appraisal?
Both a home inspection and an appraisal are designed to protect you against potential issues with your new home. Although they have very different purposes, it makes the most sense to rely on each to help confirm that you have found the perfect home.
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I've heard that some lenders require flood insurance on properties. Will you?
Federal Law requires all lenders to investigate whether or not each home they finance is in a special flood hazard area as defined by FEMA, the Federal Emergency Management Agency. We use a third party company who specializes in the reviewing of flood maps prepared by FEMA to determine if your home is located in a flood area. If it is, then flood insurance coverage will be required, since standard homeowner's insurance does not protect you against damages from flooding. -
How long does it take for the property appraisal to be completed?
Licensed appraisers who are familiar with home values in your area perform appraisals. We order the appraisal as soon as the appraisal fee is paid. Generally, it takes 10-14 days before the written report is sent to us. We follow up with the appraiser to insure that it is completed as soon as possible. If you are refinancing, and an interior inspection of the home is necessary, the appraiser should contact you to schedule a viewing appointment. If you are purchasing a new home, the appraiser will contact the real estate agent, if you are using one, or the seller to schedule an appointment to view the home.
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Does 1st Bank of Sea Isle City provide financing for manufactured homes?
Not at this time
Loans, Rates & Fees
When it comes to home financing, there are many different options to choose from. How do you find the loan that's best for you? Here is some information to help you.-
What is an adjustable rate mortgage?
An adjustable rate mortgage, or an "ARM" as they are commonly called, is a loan type that offers a lower initial interest rate than most fixed rate loans. The tradeoff is that the interest rate can change periodically, usually in relation to an index, and the monthly payment will go up or down accordingly. -
Is comparing APRs the best way to decide which lender has the lowest rates and fees?
The Federal Truth in Lending law requires that all financial institutions disclose the APR when they advertise a rate. The APR is designed to present the actual cost of obtaining financing, by requiring that some, but not all, closing fees are included in the APR calculation. These fees in addition to the interest rate determine the estimated cost of financing over the full term of the loan. Do not forget that the APR is an effective interest rate--not the actual interest rate. Your monthly payments will be based on the actual interest rate, the amount you borrow, and the term of your loan.
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How much money will I save by choosing a 15-year loan rather than a 30-year loan?
Compare Them Yourself. Use the "How much can I save with a 15 year mortgage?" calculator in our Resource Center to help decide which loan term is best for you. -
Is there a fee charged or any other obligation if I complete the online application?
There's no cost at all for completing our application. After you receive our initial loan disclosures, you can decide whether you wish to proceed with the application. If you choose to proceed, you will be asked to provide an amount used to cover the cost of the appraisal. -
Are there any prepayment penalties charged for these loan programs?
None of the loan programs we offer have penalties for prepayment. You can pay off your mortgage any time with no additional charges.
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What is your Rate Lock Policy?
Upon receipt of a fully completed application, we will communicate to you the interest rate associated with your mortgage loan. The interest rate will not change and will be honored until the closing of your mortgage loan, provided the closing takes place within 60 days of application.
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What is title insurance and why do I need it?
The function of a title insurance company is to make sure your rights and interests to the property are clear, that transfer of title takes place efficiently and correctly, and that your interests as a homebuyer are fully protected.
The purpose of title insurance is to eliminate risks and prevent losses caused by defects in title that may have happened in the past. With title insurance, you are assured that any valid claim against your property will be borne by the title company, and that the odds of a claim being filed are slim.
Title companies typically issue two types of title policies:
1) Owner's Policy. This policy covers you, the homebuyer.
2) Lender's Policy. This policy covers the lending institution over the life of the loan. Both types of policies are issued at the time of closing for a one-time premium, if the loan is a purchase.
If you are refinancing your home, you probably already have an owner's policy that was issued when you purchased the property, so we will only require that a lender's policy be issued. -
What is the maximum percentage of my home's value that I can borrow?
The maximum percentage of your home's value depends on the purpose of your loan, how you use the property, and the loan type you choose, so the best way to determine what loan amount we can offer is to complete our online application.
Your Application
Applying for a mortgage can be very intimidating. You're asked specific details about your income, assets, and debts. Here we will give you information that will let you know how that information is used when applying for a mortgage.-
What is a credit score and how will my credit score affect my application?
A credit score is one of the pieces of information that we will use to evaluate your application. Credit scores are based on information collected by credit bureaus and information reported each month by your creditors about the balances you owe and the timing of your payments. However, there are many other factors when making a loan decision and we never evaluate an application without looking at the total financial picture of a customer. -
Will I be charged any fees if I authorize my credit information to be accessed?
There is no charge to you for the credit information we will access with your permission to evaluate your application online. You will only be charged for a credit report if you decide to complete the application process after your loan is approved. -
Are we right for you?
Whether you are purchasing a new home or refinancing an existing mortgage, we are certain you will find our customer service amazing! If you will be purchasing a new home, but have not found the perfect one yet, complete our application and we will issue an approval for a mortgage loan now with no obligation!
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I'm self-employed. How will you verify my income?
Generally, the income of self-employed borrowers is verified by obtaining copies of personal (and business, if applicable) federal tax returns for the most recent two-year period. We will review and average the net income from self-employment that's reported on your tax returns to determine the income that can be used to qualify. We won't be able to consider any income that hasn't been reported as such on your tax returns. Typically, we will need at least one, and sometimes a full two-year history of self-employment to verify that your self-employment income is stable. -
Will my overtime, commission, or bonus income be considered when evaluating my application?
In order for bonus, overtime, or commission income to be considered, you must have a history of receiving it and it must be likely to continue. We will usually need to obtain copies of W-2 statements for the previous two years and a recent pay stub to verify this type of income. If a major part of your income is commission earnings, we may need to obtain copies of recent tax returns to verify the amount of business-related expenses, if any. We will average the amounts you have received over the past two years to calculate the amount that can be considered as a regular part of your income.
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I am retired and my income is from pension or social security. What will I need to provide?
We will ask for copies of your recent pension check stubs, or bank statement if your pension or retirement income is deposited directly in your bank account. Sometimes it will also be necessary to verify that this income will continue for at least three years since some pension or retirement plans do not provide income for life. This can usually be verified with a copy of your award letter.
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Can I apply for a loan before I find a property to purchase?
Yes, applying for a mortgage loan before you find a home may be the best thing you could do! If you apply for your mortgage now, we will issue an approval subject to you finding the perfect home. We will issue a prequalification letter online instantly. You can use the prequalification letter to assure real estate brokers and sellers that you are a qualified buyer. When you find the perfect home, you will simply call us to complete your application. You will have an opportunity to discuss our great rates and fees then and we will complete the processing of your request. -
If I have income that's not reported on my tax return, can it be considered?
Generally, only income that is reported on your tax return can be considered when applying for a mortgage.
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How will rental income be verified?
If you own rental properties, we will generally ask for copies of the two most recent federal tax returns to verify your rental income. We will review the Schedule E of the tax return to verify your rental income, after all expenses except depreciation. Since depreciation is only a paper loss, it won't be counted against your rental income. If you have not owned the rental property for a complete tax year, we will ask for a copy of any leases you have executed and we will estimate the expenses of ownership. -
I have income from dividends and/or interest. What documents will I need to provide?
Generally, two years personal tax returns are required to verify the amount of your dividend and/or interest income so that an average of the amounts you receive can be calculated. In addition, we will need to verify your ownership of the assets that generate the income using copies of statements from your financial institution, brokerage statements, stock certificates or Promissory Notes. Typically, income from dividends and/or interest must be expected to continue for at least three years to be considered for repayment.
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Do I have to provide information about my child support, alimony or separate maintenance income?
Information about child support, alimony, or separate maintenance income does not need to be provided unless you wish to have it considered for repaying this mortgage loan.
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Will my second job income be considered?
Typically, income from a second job will be considered if a one-year history of secondary employment can be verified.
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I've had a few employers in the last few years. Will that affect my ability to get a new mortgage?
Having changed employers frequently is typically not a hindrance to obtaining a new mortgage loan. This is particularly true if you made employment changes without having periods of time in between without employment. We will also look at your income advancements as you have changed employment. If you are paid on a commission basis, a recent job change may be an issue since we will have a difficult time of predicting your earnings without a history with your new employer. -
I was in school before obtaining my current job. How do I complete the application?
If you were in school before your current job, enter the name of the school you attended and the length of time you were in school in the "length of employment" fields. You can enter a position of "student" and income of "0."
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If my property's appraised value is more than the purchase price can I use the difference towards my down payment?
Unfortunately, if you are purchasing a home, we will have to use the lower of the appraised value or the sales price to determine your down payment requirement.
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I'm getting a gift from someone else. Is this an acceptable source of my down payment?
Gifts are an acceptable source of down payment, if the gift giver is related to you or your co-borrower. We will ask you for the name, address, and phone number of the gift giver, as well as the donor's relationship to you. Prior to closing, we will verify that the gift funds have been transferred to you by obtaining a copy of your bank receipt or deposit slip to verify that you have deposited the gift funds into your account.
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I am selling my current home to purchase this home. What type of documentation will be required?
If you're selling your current home to purchase your new home, we'll ask you to provide a copy of the settlement or closing statement you'll receive at the closing to verify that your current mortgage has been paid in full and that you'll have sufficient funds for our closing. Often the closing of your current home is scheduled for the same day as the closing of your new home. If that's the case, we'll just ask you to bring your settlement statement with you to your new mortgage closing.
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I am relocating because I have accepted a new job that I haven't started yet. How should I complete the application?
If you will be working for the same employer, complete the application as such but enter the income you anticipate you will be receiving at your new location. If your employment is with a new employer, complete the application as if this were your current employer and indicate that you have been there for one month. The information about the employment you will be leaving should be entered as a previous employer. We will sort out the details after you submit your loan for approval.
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I've co-signed a loan for another person. Should I include that debt here?
Yes. We may require you to provide verification that the other person responsible for the debt has made the required payments by obtaining copies of their cancelled checks or bank statements -
I have student loans that aren't in repayment yet. Should I show them as installment debts?
Any student loan that will go into repayment within the next 60 months should be included in the application. If you are not sure exactly what the monthly payment will be at this time, enter an estimated amount.
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What, exactly, is an installment debt?
An installment debt is a loan that you make payments on, such as an auto loan, a student loan or a debt consolidation loan. Do not include payments on other living expenses, such as insurance costs or medical bill payments.
Closing & Beyond
Hurray! Your loan has been approved and your loan closing date has been set! This section will give you some idea of what to expect at closing and what happens after closing.-
What happens at the loan closing?
The closing will take place at the office of a title company or an attorney who will act as our agent. If you are purchasing a new home, the seller may also be at the closing to transfer ownership to you. During the closing, you will be reviewing and signing several loan papers such as the Note and the Mortgage documents. Just to make sure there are no surprises at closing, your loan officer will contact you a few days before closing to review your final fees, loan amount, first payment date, etc. The most important document you will be signing at the closing includes the Closing Disclosure. This document provides an itemized listing of the final fees charged in connection with your loan as well as the interest rate and term. If your loan is a purchase, this settlement statement will also include a listing of any fees related to the transaction between you and the seller. If this loan will be a refinance, this settlement statement will show the payoff amounts of any mortgages that will be paid in full with your new loan. -
Will I need to have an attorney represent me at closing?
Please contact the closing agent if you have questions about attorney representation. By all means, we recommend that you have an attorney at the closing if it would make you more comfortable. If your attorney has any questions about your new mortgage, please refer them to your loan officer. We will be happy to provide any information necessary.
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Can I get advanced copies of the documents I will be signing at closing?
The most important documents you will sign at closing are the note and mortgage, sometimes called the deed of trust. Unless there are special circumstances, these documents are usually prepared one to two days before your closing. Other documents are prepared by the closing agent the day before or the day of your closing. If you would like copies of the completed documents to be sent to you after they are prepared, please contact your loan officer.
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Who will be at the closing?
The closing agent acts as our agent and will represent us at the closing. However, your personal loan officer will contact you prior to closing to talk about your final documents and to provide a final breakdown of your closing fees. If you have any questions that the closing agent can't answer during the closing, ask them to contact your loan officer by phone and we will get you the answers you need before the closing is over.
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If I apply, where will the closing take place?
We work with several local title companies to conduct our loan closings. We will deliver our loan documents and wire transfer your loan funds to the closing agent prior to closing so that they will have plenty of time to prepare for your closing. -
Can I make my monthly payments with an automated debit from my checking account?
Automated monthly payments are available. After the loan closing, contact your loan officer to arrange for an automated payment.