MortgagesZ

By: Lana Hampton

When you’re looking for a home loan, you might work with an officer at a bank or other lending institution, or you might choose to work with a mortgage broker. The end result is the same - a new house, but the two types of jobs differ.

Bank Loan Officers: The loan officers at a bank, credit union or other lending institution are employees who work to sell and process mortgage and other loans originated by their employer. They often have a wide variety of loan types to draw from, but all originate from that specific lender.

The loan officer takes your mortgage application and works to find a loan product that suits your needs. If your personal credit is approved, the officer moves forward to process the home purchase transaction.

Mortgage Brokers: Mortgage brokers are professionals who are paid a fee to bring together lenders and borrowers. They usually work with dozens or even hundreds of lenders, not as employees, but as freelance mortgage agents.

Think of mortgage brokers as scouts. They find and evaluate homebuyers, analyzing each person’s credit situation to determine which lender is the best fit for that person’s needs. The mortgage broker submits the homebuyer’s application to one or more lenders in order to sell it, and works with the chosen lender until the loan closes. A good mortgage broker can find a lender for just about any type of credit.

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By: Steve

A Home Equity Mortgage is a loan that you can raise as a homeowner. The money you borrow is provided against the security of your home. This means that the person who has lent you the money can take over your home if you fail to repay the loan. To qualify for this kind of a mortgage, you should be regularly employed for at least two years and have no delayed payments on your credit card for at least six months.

Before you apply for a mortgage, locate papers such as your most recent pay stubs, any employment records of the last two years, your social security number, W-2s, bank statements from your savings accounts, your income-tax returns and serial numbers of stocks or bonds you have bought. You may also need to provide information on retirement plans, other loans and liabilities and other assets purchased. As a self-employed person, you may need to provide profit and loss statements for the last two years, as well as business tax returns with schedules and W-2s attached. If you are divorced, you will need to provide a divorce decree along with a 12-month record of alimony and child support payments to qualify for a loan.

You can get loans at fixed rates of interest and pay these off over 15 to 30 years. The rate of interest varies between 3.5 per cent — 7.5 per cent and depends on the time required to pay off the loan. You can also get loans where the rate of interest is determined by market rates and economic changes. Some popular adjustable rate mortgage (ARM) loans are the ones where the interest rate remains the same for five years and then changes for every one year.

When mortgaging your home, you will give the lender a down payment and will pay off the rest of the loan over a long period of time. Your payment is divided into the principal or the sum of money left after making the down payment and the interest on the loan, or a percentage charged by the lender for lending you the money. You will also be required to pay property taxes and insurance premiums on your home.

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