Mortgage Loans
It’s not easy to buy a house depending only on your salary. But people still want to do it and that’s why they are choosing to turn to such thing as mortgage. The concept of a mortgage is rather simple. Your mortgage lender advances you a required sum of money and you repay it within a determined period of time (mortgage loan term). Below you will find mortgage loan information and the steps you need to make to purchase a new home:
Step 1. You will contact Platinum Lending, LTD to choose a loan program that suits you best.
Step 2. Platinum Lending will issue an approval letter for you and/or your real estate agent.
Step 3. You and/or your real estate agent will make an offer to purchase a home and return the purchase agreement to Platinum Lending.
Step 4. You meet with your loan officer at Platinum Lending to sign your loan paperwork and bring documents necessary to be submitted to the underwriter.
Step 5. The loan documents are delivered to the closing agent for your closing of the loan and within 24 – 48 hours, your loan funds and your record onto title of your new home!
Note that there are three components of the monthly payments a borrower pays: the principal, interest, and escrow account. The principal and interest both refer to the interest rate. The principal refers to the amount of money you borrow to buy a home, and to the outstanding loan balance at any point during the mortgage term. Interest is the cost of borrowing money. It is determined by the percentage of your outstanding loan balance that you pay the lender each month, i.e. the interest rate. The interest rate is based on the current overall rate environment, as well as on the financial profile of the debtor and the specific features of the loan. In the framework of the monthly payments you are also required to pay taxes and insurance, or, in other words, take part in an escrow. The essence of the process is as follows: the lender collects this money from the debtor each month and then pays annually or semi-annually on his behalf to certain local government and insurance company.
On the opening of the loan, apart from the customary fees, a borrower will also be required to pay their homeowner’s insurance. The homeowner’s insurance is normally collected by the lender in an escrow account and has two major components: homeowner's insurance (hazard insurance) and mortgage insurance, which protects the lender in the event that a borrower fails to repay his mortgage and is only necessary when the mortgage is above 80% Loan to Value.
Discount points give you an opportunity to pay less each month by buying your rate down, provided you pay the discount point(s) upon the closing of your mortgage loan (mortgage buydown). Each point equals 1% of the loan amount and maybe increased by you to obtain a lower monthly payment.
The factors mentioned above make up a mortgage payment calculator and determine the total expenses that you will bear and the size of your down payment you will have to make once you have chosen the ideal mortgage for you. They can be expressed by the term of the annual percentage rate. Which, as an economic notion, includes the quoted interest rate (used to calculate the principal and interest) and also required loan fees such as loan points, fees and mortgage insurance.
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