We don’t think that saving for a down payment should be the reason you put your dreams on hold. We can help you buy your dream home with a zero down mortgage loan. You’ll not only be able to afford a home sooner, you’ll probably be able to afford more home. With a zero down mortgage, the amount of loan you can qualify for is determined by your ability to make your monthly payments rather than how large a down payment you’ve saved. And, for most buyers, this means qualifying for a larger loan.
Buying a home is something we all dream about, usually for years. You may have saved money for a down payment, but just don’t have enough to buy your dream home. If that’s the case, a piggyback loan may be the best option for you. Different than a zero down mortgage, a piggyback loan is actually two mortgages. The first mortgage is for 80% of the purchase price. The “piggyback” loan (or second mortgage) covers the shortfall between the purchase price and your down payment savings
Let us help you explore all your mortgage options. We look forward to helping you!
Should I consider financing the closing costs, escrow reserves, or any other cash needed to close my loan at settlement?
If you’ve built up some equity in your home, when you refinance, you may be able to “cash out” some of that equity to pay off credit cards or other revolving debt, improve your home, help pay for college, or anything else you can think of. The same is true of the closing costs. If you have enough equity in your home, you may be able to roll in some or all of the costs due at closing into your loan.
Some of the “cash needed to close” as it’s sometimes called includes settlement costs and fees, prepaid interest, escrow reserves, state or local government charges, discount or origination points, or even extra funds needed to pay off your existing mortgage. Some or all of those costs can sometimes be financed as part of your new mortgage loan.
Do be aware that it’s not always the case that you can borrow up to 100 percent of your home’s value. Many loan programs are based on what is called a “loan-to-value” ratio. You may qualify for a better rate and closing costs if you borrow no more than 80 percent of your home’s value. You may not qualify for the same terms if you borrow 90 percent or 100 percent of your homes value. We can help you qualify for refinance loan programs for far greater than 100 percent of your home’s value in many cases. That being said, the lower your loan-to-value ratio (that is, the less you borrow versus how much your home is worth), the better terms you’ll generally qualify for.
Also, no closing costs options are available to you. In this case you can reduce your up-front costs for refinancing your mortgage in exchange for higher monthly payments for the life of the loan. Whether, and to what extent, you can do this depends on the value of your home, the amount of your new mortgage, and what options you decide are best for you. A licensed loan officer at Global Home Finance Inc. can help you determine the right mortgage product for your unique needs.
Some people find that it’s advantageous to pay the cash needed at closing from checking, savings or money market accounts or from other assets. This is because the less you borrow on the new refinanced loan, the lower your monthly payment will be and it also lowers the total amount of interest you pay over the life of the loan. Based on our experience about 87% of our borrowers elect to roll in some part of the closing costs into a refinance loan. We’ll work with you to see if there is an advantageous refinancing program for you based on your ability and willingness to pay closing costs, escrow account reserve establishment, how long you will keep the house or mortgage, and the amount you wish to borrow. Consulting with a licensed Residential Mortgage Loan Originator who listens to your goals and needs is the best way to get the best product for you.
Please allow us to make the best loan for you! We would love to prove to you how we are working hard to Save Texas One Home Owner At A Time!
For loans made since July 1999, lenders are required (by federal law) to automatically cancel Private Mortgage Insurance (PMI) when the balance of the loan gets below 78 percent of the purchase price. (This law does not include some higher risk mortgages such as FHA loans.)
The calculations to determine when the monthly mortgage insurance are made from your principal payments toward your mortgage balance and does not fall off when the borrower achieves 22 percent equity by the housing market having appreciated rather it is from the lesser of the original purchase price or appraisal. If the previous loan was a refinance loan and there was monthly mortgage insurance then the appraised value at the time the loan was initiated will be used. The good news is that you can request cancellation of your PMI yourself (for your mortgage that closed after July ’99), no matter the original price of purchase, when your equity reaches twenty percent even if it is because of the homes market appreciation. Also, keep in mind that the Mortgage Insurance Company will have a minimum contract term of 2 or 3 years on Conventional Mortgages. So, you will have the mortgage insurance for 2 or 3 years even if you pay the balance down below 80% before the minimum contract term has been met if that was a piece of the original Mortgage Insurance Certificate.
Keep track of payments
Familiarize yourself with your monthly statements to keep your eye on principal payments and your current principal balance. You will also want to stay aware of the the purchase prices of the homes that are selling in your neighborhood that are similar to your own, or at the very least the price per a square foot if comparable homes are not available. If your mortgage is fewer than five years old, chances are you haven’t paid down much principal – it’s been mostly interest meaning your chances of removing mortgage insurance are small if the home has not appreciated in value.
Verify Equity Amount
At the point you think you’ve achieved at least 20 percent equity in your home, you can start the process of canceling your Private Mortgage Insurance. You have more than one option here. If mortgage rates are better you can often remove PMI by refinancing. If you are not looking for cash out in many cases without an appraisal. The other way is to communicate to your loan’s servicer via their customer service department that you are asking to cancel your PMI. The servicing institution will request proof that your equity is at 20 percent or above. You can acquire documentation of your equity by getting a state certified appraisal on form URAR-1004 (Uniform Residential Appraisal Report), required by most institutions before canceling PMI. Make sure the servicer does not require the use of one of their appraisers before obtaining the appraisal.
At Global Home Finance Inc., we answer questions about PMI every day. Call us: 972-724-3222.
There are certain standard costs related to closing the sale of a house. Buyers and sellers almost always share these costs, as specified in the real estate sales contract.
As you’ll see below, many of the buyer’s closing costs cover the costs of getting the mortgage loan. Since Global Home Finance Inc. has extensive experience with closings & mortgages, we are closing cost experts.
Good Faith Estimate (GFE)
Very shortly after you submit your application, we will give you a “Good Faith Estimate” of your costs. We base this cost estimate on our many years of past experience. Please note that while our GFEs are very precise, we cannot always estimate your costs to the penny. We review Good Faith Estimates with buyers almost every day, so we are happy to answer your questions about closing costs.
We’ve provided a general list of these costs below, but we’ll provide you a specific list of closing costs, with amounts, soon after you complete your loan application. At Global Home Finance Inc., we don’t believe in surprises, so if your costs change, we’ll be sure to let you know immediately.
Points — A fee paid to lower your mortgage interest rate (optional)