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Have a look at the presentation on mortgage loan, mortgage process and mortgage types.
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What is a mortgage loan?What is a mortgage loan? A loan secured by real
property such as land, home etc.
This is used to make large real estate purchase.
The borrower has to repay the loan over a period of time, along with the interest.
Once the loan is paid off in full along with the interest, the borrower becomes the owner of the property.
Mortgage Loan ProcessMortgage Loan Process
Pre-qualificationPre-qualification Apply for a mortgage Apply for a mortgage
loanloan The processing of loan The processing of loan
applicationapplication Home appraisalHome appraisal UnderwritingUnderwriting Loan closingLoan closing
Pre-qualificationPre-qualification
This is the initial step in mortgage loan process. You supply information on your income, debts and
assets to a lender. This can be done over phone or through internet. After reviewing your information, the lender gives
you an idea of the mortgage amount that you can qualify.
Lender does not pull your credit report. Getting pre-qualified does not ensure mortgage loan.
The Processing of Loan ApplicationThe Processing of Loan Application
Last 2 pay check stubs Last 2 W-2 forms Last 2 bank statements Other documents as
may be required by the lender.
These documents are required for mortgage loan processing.These documents are required for mortgage loan processing.
Loan ClosingLoan Closing
This is the last step in This is the last step in getting a mortgage getting a mortgage loan.loan.
You sign the loan You sign the loan contract.contract.
You have a number of You have a number of closing fees.closing fees.
Fixed Rate MortgageFixed Rate Mortgage
Interest rate remains fixed for the entire term of the loan.
Monthly payment amount remains fixed for the entire term of the loan.
Examples – 5-year fixed rate mortgage, 30-year fixed rate mortgage etc.
Adjustable Rate MortgageAdjustable Rate Mortgage Rate of interest remains fixed for an initial
period of time.
Once that initial period is over, rate varies with some benchmark index.
The benchmark index may be – LIBOR, COFI, US Treasury bond rate etc.
The monthly payment remains fixed in the initial period. Thereafter, it varies.
Examples–2/28, 3/27 adjustable rate mortgages. In 2/28 mortgage, the initial interest rate is fixed for a period of two years and then it varies for the remaining 28 years of the mortgage. Same intepretation holds for 3/27 adjustable rate mortgage.
MortgageFitMortgageFit
For more information on mortgageFor more information on mortgage
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