Matthew Shields-USA Mortgage

The Loan Estimate is a disclosure, required by law, that every lender must provide to the borrower within 3 business days of a completed application. It is a detailed initial estimate of your projected closing costs, itemizing things like mortgage insurance, title insurance, recording fees, the finance charge, annual percentage rate (APR), number of payments you will make and an estimate of what your monthly payment will look like. These numbers are not final. Official and final figures will be collected and adjusted, then sent to you again before closing day.

A mortgage bank is a company that markets other investors’ products, similar to independent insurance agents and travel agents, and they offer mortgage products and services to consumers from several investors. The advantage of this is that a broker can offer low rates because they can utilize the investor offering the best prices that particular day. Another advantage is that a broker has access to many different programs than any one lender will provide. A loan that one bank cannot do, could possibly be done by a broker because they have an arsenal of investors that offer programs for your situation. USA Mortgage is a full-service mortgage broker. The only way this impacts you is that your loan will be owned and serviced by the investor (not USA Mortgage). USA Mortgage originates the loan, does all the processing of your loan all the way through closing. You are only transferred to the loan servicer's care after closing day.

FIXED-RATE MORTGAGES have an interest rate that never changes over the term of the loan. With a fixed-rate loan, the principal and interest portion of your monthly mortgage payment stay the same. Although, real estate taxes and homeowners insurance costs can rise from year to year, they would be the only variable that could change your monthly payment. ADJUSTABLE RATE MORTGAGES typically have a lower interest rate during the initial introductory period (commonly 5 or 7 years) than a fixed-rate mortgage would (depending on current market conditions). After the introductory period of an adjustable rate mortgage is over, the interest rate is allowed to rise annually every year after that, determined by the climate of the market.

An interest rate lock guarantees your rate. After you are under contract for a home purchase and your official loan program is determined, your mortgage loan originator will “lock-in” your interest rate. This means that your rate has been confirmed and will no longer be subject to market changes that could increase your rate. This prevents your rate from rising to the point where it could price you out of being able to afford or qualify for the home you have under contract. Typical rate locks are 30 days in length, but if for some reason you have a longer closing window on your purchase contract, your mortgage loan originator can choose a 45 to 60 day lock period for your loan, depending on your circumstances.