Buy a Home
Homebuyer FAQs in the Greater Chicago & Nashville Areas
Below are answers to the common questions about buying and financing a home purchase. Don’t see what you’re looking for? The best mortgage advice is only a phone call away. Remember, online research only goes so far, so talk to a real mortgage expert. You’ll be happy you did. Call 708-531-8388.
For most borrowers, each monthly mortgage payment includes:
Principal, which is the total outstanding balance of the loan
Interest, which is the cost of borrowing money
Taxes, which are levied on the property by the local government
Insurance, which protects the owner and the lender from losses caused by fire and natural hazards.
Check out our loan calculators for an estimate of your monthly payment, or call us for quote specific to your current or desired property.
Locking your interest rate means your mortgage rate is guaranteed even if market rates change before closing. Most lenders allow you to lock a rate for 30 to 60 days, with the option to extend the rate-lock period for a fee. How do you know whether or not to lock your interest rate? It depends on if you expect rates to rise or fall before you close on your home. No one knows for sure which direction rates will go at a given time, so it's difficult to make a reliable
prediction. It helps to keep track of announcements from the Federal Reserve Board and to talk to your financial advisor about what may happen in the near term. Call us for a custom quote and current market assessment.
Discount points are interest prepaid to your lender at closing in exchange for a lower interest rate on your mortgage. Each discount point is equal to 1% of the loan amount, and is often called "buying down" your rate when you pay a point.
Does paying points make sense for you? The answer depends
primarily on how long you plan to stay in your home. First, find out how much lower your monthly payments will be if you pay points. Then, calculate how long it will take for the monthly savings to add up to the cost of the points. If it would take five years to break even and you're planning to live in your home for ten, paying discount points may be a smart move. Call us for help with a custom
Closing costs vary based on a number of factors such as individual lender costs, mortgage type, purchase contract, and location - but they usually include the following:
Lender fees: your mortgage company may charge for loan related expenses, including an appraisal fee, a credit report fee, origination points, and discount points.
Third party fees: cost for services not provided by your lender often include the settlement fee, title insurance, and attorney fees.
Prepaid items: certain mortgage expenses must be paid to your lender in advance.
The most common are pre-paid interest, hazard insurance, and deposits to set up an escrow account.
If you already own or have a property in mind for financing, call us for a custom closing cost quote.
Private Mortgage Insurance (PMI) provides your lender with a way to recoup its investment if you are unable to repay your loan. PMI is usually required when the mortgage amount is higher than 80% of the home's value. That means that if you buy a home with a down payment of less than 20%, you will probably have to pay for PMI. There are numerous programs available with low cost, cancellable PMI options. Call us for a custom quote.
There is generally no minimum down payment required for buying a home. Many first-time buyers believe they need as much as 20% of a home's purchase price in cash. That may have been true in the past, but now mortgage loans are available with as little as 3% down. With housing prices as high as they are, homeownership would be impossible for many people without low down payment options. United Home Loans has a number of loan options that can help you buy a home with little cash. Call us if you need help
determining what loan is best for you.
Your credit history is only one factor in qualifying for a mortgage, so late payments don't necessarily disqualify you. There are a
variety of mortgage options to help people with less-than-perfect credit become homeowners and leave credit challenges behind. Call us for help getting on the path to home ownership.
Getting pre-approved means you receive a loan commitment from your mortgage company before you find a home. Your pre-approval amount is based on a review of your credit and finances, and this commitment shows sellers that you're a qualified buyer. The pre-approval process is quick and easy. United Home Loans offers same day loan commitments, so you can start home shopping right away. Call us at 708-531-8388 if you need help navigating loan options.
Lenders consider many factors when evaluating your loan
application, but they usually focus on four areas:
1. Income and debt: How much money you make and what other bills you have to pay helps the lender determine if you can afford to make mortgage payments.
2. Assets: This assures the lender that you have enough money to cover the costs of buying a home.
3. Credit: Whether or not you've met past financial obligations helps the lender predict whether you will repay your mortgage.
4. Property: The home you want to buy has to be worth enough to act as collateral for the mortgage.
Again, loan decisions are often unique, so if you’re unsure if you’ll qualify and how much mortgage you can afford, call us today for advice custom to you.
As both a mortgage banker and lender, United Home Loans has the ability to shop dozens of banks and lending institutions to ensure that you receive the best possible interest rate and loan program. We search for the lowest rates, so you don't have to. Plus, with
in-house processing and underwriting, decisions regarding your loan are handled locally from start to finish. Call us with any
mortgage question and see why we’re the best.