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While a myriad of expenses go into buying and owning a home, the biggest expense for most is the mortgage payment. Here are five great tips from Bankrate for reducing mortgage costs—both before and after you purchase a home.

  1. First, get pre-approved for your mortgage, not just pre-qualified. Preapproval involves the lender doing their due diligence by pulling your credit report, verifying your income and taking other steps to determine your maximum loan amount. For a preapproval, the lender also commits to making the loan if you buy the home within a set amount of time. The lender doesn’t review your information for a prequalification and, therefore, there’s no guarantee the loan will be approved.
  2. If you’re looking to buy a newly built home, ask about builder incentives, such as discounted upgrades or reduced closing costs when you use an affiliated lender. According to Bankrate, instead of cutting the price of a new home, the homebuilder will sometimes offer thousands of dollars in discounts as an incentive to use the builder’s preferred lender and settlement company.
  3. Use the Loan Estimate, a three-page document you get after you apply for a mortgage, to compare loan offers. Specific information you should look for includes: estimated monthly payment; interest rate; estimated closing costs; how much you’ll need at closing.
  4. Pay discount points to buy down the rate if you have cash available and want to lower your monthly payments. In exchange for more money upfront, lenders are often willing to reduce the interest rate, thereby reducing your monthly mortgage payment. According to Bankrate, a payment of 1 percent of the loan amount is called 1 point—and will usually decrease the mortgage rate by a quarter of a percentage point.
  5. Negotiate fees to reduce closing costs. While some fees are charged by third parties, such as title companies, some lenders may be willing to negotiate their origination fees. Applying with competing lenders will give you some negotiating power, as well as the ability to do some comparison shopping with third-party fees. Be sure to shop around on home inspections and home insurance, too.

Questions? Contact a mortgage consultant near you!

 

 

 

Reprinted with permission from RISMedia. ©2018. All rights reserved.

Source: Bankrate.com

All first mortgage products are provided by Prosperity Home Mortgage, LLC dba FM Lending Services. (877) 275-1762. Prosperity Home Mo­­­rtgage, LLC products may not be available in all areas. Not all borrowers will qualify. Licensed by the NJ Department of Banking and Insurance.  Licensed by the Delaware State Bank Commissioner.  Also licensed in District of Columbia, Florida, Georgia, Indiana, Maryland, Michigan, North Carolina, Pennsylvania, South Carolina, Tennessee, Virginia, and West Virginia.
NMLS ID #75164 (NMLS Consumer Access at http://www.nmlsconsumeraccess.org/)
©2018 Prosperity Home Mortgage, LLC dba FM Lending Services. All Rights Reserved.


You’re probably well aware of how important your credit score is. A good score grants you access to loans and favorable interest rates, and opens up many different possibilities for a healthy financial future.

But do you know how your credit score is determined? Be aware of the factors used in credit-scoring models so you can work towards achieving a higher credit score. Here are some of the top factors, according to Credit Karma:

On-Time Payment Percentage
This is the percentage of payments you’ve made on time during your credit history. This plays a big role in determining your creditworthiness, so just a couple of late payments could significantly impact your score for the worse. An easy way to avoid late payments? Set up automatic bill pay or create calendar reminders for bill due dates.

Credit Card Utilization
This is a percentage that is calculated by taking the total of your credit card balances and dividing that number by your total credit card limits. This will show creditors how much of your total available credit you are already using. The lower your credit card utilization, the higher your credit score.  

Average Age of Open Credit Lines
The longer your credit history and the older your accounts the better. That’s why it’s a good idea to keep older cards open and active, and to start applying for credit at a young age.

Total Accounts
Consumers with more accounts (or more lines of credit) often have higher credit scores because it indicates that more lenders are willing to give them credit. Having a good mix of different types of credit is good for overall credit health as well. But be prudent: Only apply for credit you actually need.

Hard Inquiries
When you apply for a credit card, mortgage or auto loan, a hard credit inquiry is initiated on your credit report. One hard inquiry will usually have little impact, but multiple inquiries can have a larger impact. A soft inquiry is when you check your rate to see what you qualify for. If you’re unsure, check with your potential creditor or lender before applying to see if they will do a hard or soft pull.

Derogatory Marks
Derogatory marks are negative items on your credit report like collections, tax liens or bankruptcy. These records can stay on your credit report for 7 to 10 years. If you have one on your credit report, it can show a lender that you may have mismanaged your credit in the past. The best way to overcome derogatory marks is to start rebuilding healthy credit again. This will gradually weigh in your favor.

Questions? Contact your local mortgage consultant.

 

 

 

Reprinted with permission from RISMedia. ©2018. All rights reserved.

All first mortgage products are provided by Prosperity Home Mortgage, LLC dba FM Lending Services. (877) 275-1762. Prosperity Home Mo­­­rtgage, LLC products may not be available in all areas. Not all borrowers will qualify. Licensed by the NJ Department of Banking and Insurance.  Licensed by the Delaware State Bank Commissioner.  Also licensed in District of Columbia, Florida, Georgia, Indiana, Maryland, Michigan, North Carolina, Pennsylvania, South Carolina, Tennessee, Virginia, and West Virginia.
NMLS ID #75164 (NMLS Consumer Access at http://www.nmlsconsumeraccess.org/)
©2018 Prosperity Home Mortgage, LLC dba FM Lending Services. All Rights Reserved.


When interest rates rise, ask about an Assumable Mortgage.

 

What is an assumable mortgage?

An assumable mortgage is a loan that a buyer can take over from the seller of a home, often with little or no change in the loan’s terms, including the interest rate. After obtaining a lender’s approval, a qualified buyer agrees to make future payments as if they took out the original loan on the home.

What types of loans are assumable?

  • All government loans, such as FHA and VA loans
  • All conventional adjustable rate mortgage (ARM) loans
  • Some non-conforming ARM loans1

Advantages of an assumable mortgage:

  • If the seller’s interest rate is lower than the rate a buyer can obtain based on current market rates or credit history, the buyer may enjoy significant savings.
  • Fewer closing costs are associated with an assumable mortgage.
  • Because not all mortgages are assumable, a seller may also benefit by marketing this advantage when competing with other homes on the market.

Considerations of an assumable mortgage:

  • A buyer will be required to qualify for the terms of the existing loan in order to assume the mortgage.
  • If the sale price of the home is more than the mortgage amount remaining on the home, a buyer will need to pay for the difference at closing out-of-pocket.
  • Certain conditions will need to be met based on the existing loan type.

If you have questions about an assumable mortgage, please contact a mortgage consultant near you!

 

 

 

1. Ask your local mortgage consultant to discuss assumable non-conforming loan programs for which you may be eligible.

All first mortgage products are provided by Prosperity Home Mortgage, LLC dba FM Lending Services. (877) 275-1762. Prosperity Home Mortgage, LLC products may not be available in all areas. Not all borrowers will qualify. Licensed by the NJ Department of Banking and Insurance.  Licensed by the Delaware State Bank Commissioner.  Also licensed in District of Columbia, Florida, Georgia, Indiana, Maryland, Michigan, North Carolina, Pennsylvania, South Carolina, Tennessee, Virginia, and West Virginia.

NMLS ID #75164 (NMLS Consumer Access at http://www.nmlsconsumeraccess.org/)

©2018 Prosperity Home Mortgage, LLC dba FM Lending Services. All Rights Reserved.


As interest rates have risen, much attention has been paid to the effect rising rates may have on the housing market.  While interest rates do play an important role in your monthly mortgage payment, they are not the only factor to consider.

If you’re planning to purchase a home this year, be sure to understand each of the components that make up a mortgage payment, which can help you determine a monthly payment with which you are comfortable.  Here are the parts of a mortgage payment:

Principal: The principal part of your monthly payment pays off the loan amount you initially borrowed to buy your home.

Interest: In return for providing the funds you need to buy a home, lenders charge monthly interest on the principal balance you owe.

Taxes: Property taxes may be collected by your lender on a monthly basis and held in an escrow account to be paid on your behalf as they come due. The good news is: property taxes are usually fully deductible at income tax time. Consult a tax advisor for details.

Homeowners Insurance: Homeowners insurance provides financial protection in the event of losses that are the result of fire, wind, natural disasters or other hazards. Most mortgage lenders require you to have a homeowners insurance policy and may also be collect these funds to hold in an escrow account to pay your insurance company.

Mortgage Insurance: Mortgage insurance protects the lender against financial loss if a customer fails to repay the loan.

  • FHA-insured loans require a mortgage insurance premium (MIP)
  • VA loans may require a funding fee
  • Conventional loans can be insured with private mortgage insurance (PMI)

If mortgage insurance is applicable to your loan, that part of your payment is forwarded to the agency providing the insurance.

If you have questions, our mortgage consultants are always available to help you understand the home loan process!  Please also check out our on-line resources such as our mortgage payment calculator or the basics of buying!

 

 

 

This table is only to be used as a guide and does not include all loan types or loan features. Not all loan types are available to all borrowers. Borrowers will be subject to qualification and must satisfy all underwriting requirements and conditions. Not all borrowers will qualify. Speak with your mortgage consultant and carefully consider each of your home financing options so you can determine the home loan that is right for you.

All first mortgage products are provided by Prosperity Home Mortgage, LLC dba FM Lending Services. (877) 275-1762. Prosperity Home Mortgage, LLC products may not be available in all areas. Not all borrowers will qualify. Licensed by the NJ Department of Banking and Insurance. Licensed by the Delaware State Bank Commissioner. Also licensed in District of Columbia, Florida, Georgia, Indiana, Maryland, Michigan, North Carolina, Pennsylvania, South Carolina, Tennessee, Virginia, and West Virginia.

NMLS ID #75164 (NMLS Consumer Access at http://www.nmlsconsumeraccess.org/)

©2018 Prosperity Home Mortgage, LLC dba FM Lending Services. All Rights Reserved.


Venturing out to search for your first home is one of the most exciting times of your life! Unfortunately, it is also one of the most daunting. Between a lexicon of new terms and an onslaught of online information, the process of shopping for a home is understandably overwhelming for first-timers. First, take a deep breath. Then follow these steps and you’ll be on the path to finding your first home in no time:

1. Start searching for a real estate professional. You’ll need a well-informed, trusted guide throughout this process so start looking for a real estate agent to work with. Ask friends and family members for recommendations then do your research online to evaluate any individuals and conduct in-person interviews as well. Be sure to speak with at least three agents before choosing someone to work with.

2. Figure out what you can afford. Before you start looking at neighborhoods and homes, determine what you can comfortably afford... the key word being “comfortable.” There are many unexpected expenses that arise when you’re a homeowner, so don’t stretch yourself too thin. Determine how much you can afford for a down payment, then use an online mortgage calculator to see what your monthly payments might be for various-priced homes. Once you’ve arrived at your budget, stick with it.

3. Pick your neighborhoods. Choose your location before you start looking at homes, as where you live will ultimately be more important - both in terms of your day-to-day happiness and your investment - than the home itself. You may have to compromise a bit on location depending on the home you can afford. Your real estate agent can help advise you here.

4. Choose your musts. When thinking about the home you’d like to buy, take an honest look at needs vs. wants. Sure, there are a lot of things we’d love to have in our dream home, but figure out what are the nice-to-haves vs. the must-haves.

5. Search online. Once you’ve got your price range, your neighborhoods, and your must-haves down, start your search online to narrow down your options. Your real estate agent may also know of some homes that fit the bill right off the bat. This will mean fewer homes to visit in person and hopefully, lead to a quicker selection.

Above all, be open minded, flexible and patient in the home-search process. Your opinions and priorities may change as you learn more, and despite the best planning, curve balls happen. The journey will be well worth it, however, once you’re happily settled as a new homeowner.

 

When you’re ready to discuss your home financing options, contact a local mortgage consultant who can answer any questions you have about the mortgage process.

 

 

 

 

Reprinted with permission from RISMedia. ©2018. All rights reserved.

This list is only to be used as a guide and is not all-inclusive.

All first mortgage products are provided by Prosperity Home Mortgage, LLC dba FM Lending Services. (877) 275-1762. Prosperity Home Mortgage, LLC products may not be available in all areas. Not all borrowers will qualify. Licensed by the NJ Department of Banking and Insurance. Licensed by the Delaware State Bank Commissioner. Also licensed in District of Columbia, Florida, Georgia, Indiana, Maryland, Michigan, North Carolina, Pennsylvania, South Carolina, Tennessee, Virginia, and West Virginia

NMLS ID #75164 (NMLS Consumer Access at http://www.nmlsconsumeraccess.org/)

©2018 Prosperity Home Mortgage, LLC dba FM Lending Services. All Rights Reserved.


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