Can I apply for a mortgage home loan before I find the home I want?
Yes. And doing so can be one of the smartest decisions you make. When you apply for a home loan in advance you will also want to get a letter of pre-approval. With a mortgage pre-approval letter you know exactly what you can afford and what type of monthly payments you can make. Having a pre-approval letter will also give you an advantage over other buyers.
Can I borrow funds, or use gift funds, towards a down payment?
Yes. You are allowed to borrow funds from yourself – i.e. 401K loans or home equity loans. You cannot use borrowed funds from an unsecure loan as a down payment not can it be used to pay for closing costs. You can receive gift money for a down payment. However, if you receive money for a down payment as a gift it is required that the gift giver is related to you.
How are mortgage interest rates determined?
Interest rates can change based on a number of different factors. Over time, inflation has the largest influence on the fluctuation of interest rates. The Federal Reserve implements policies intended to keep inflation and interest rates as low and as stable as possible.
Should I lock my rate or let it float?
Mortgage interest rates are hard to predict. If you have an idea that interest rates are on their way up then you will want to lock your rate as soon as possible. Because you lock your rate make sure that your loan is going to close within your lock period, a lock on your interest rate does you no good if the lock expires. If you think that interest rates are going to go down before your mortgage loan closes then you can take a risk and let your rate float instead of locking.
United Home Loans provides mortgage pre-approvals for homes in Illinois, Indiana, Michigan, Minnesota and Wisconsin. In addition, we are licensed to lend in all five of these states for the purchase or refinance of a primary residence, second home or investment property.