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  1. The three major credit bureaus can assist you in obtaining a copy of your credit report. There are many websites that can provide that information, such as

  2. YES. bankHometown allows you to lock in your rate after we receive your intent to proceed.

  3. Pre-qualifying for a mortgage is easy and convenient. You should contact your bankHometown Loan Originator and arrange an appointment.

    Your Loan Originator will review your income, asset and credit information and then be able to tell you how much of a mortgage you can afford.

  4. bankHometown typically does not require any inspections for residential mortgages. However, if there is an apparent concern regarding the property, test(s) for Title V, smoke, or radon may be required.

  5. Private Mortgage Insurance is required when the down payment is less than 20%. It protects the lender against loss if the borrower defaults on the loan. The cost will vary depending upon the type of mortgage you have, your credit profile, and the amount of your down payment.

  6. Closing costs are costs that you will incur in the process of obtaining your mortgage. They typically include fees such as points (optional), appraisal, legal fees, title insurance. Additionally, at closing, there are escrows for property taxes and Private Mortgage Insurance, if applicable.

  7. In addition to principal and interest, an escrow payment for property taxes, flood insurance, and Private Mortgage Insurance (if applicable) may be included in your payment.

  8. A fixed-rate mortgage is a loan where the principal and interest payments (P&I) never change over the life of the loan, since the interest rate never changes. An adjustable-rate mortgage has an interest rate that will change at various intervals during the life of the loan; therefore, the principal and interest payment will change periodically.

  9. A point is the equivalent of 1% of the loan amount. For example, if the mortgage is $100,000.00, 1 point would be $1,000.00. Usually interest rates are offered in combination with 0, 1, or 2 points. If you choose to pay 1 or 2 points, your interest rate will be lower. For example, rates that might be offered are 6.25% with 0 points, 6.00% with 1 point or 5.75% with 2 points.

  10. APR means Annual Percentage Rate. This should not be confused with your mortgage interest rate. APR is the yield the lender calculates on your mortgage when it takes into account finance charges you will pay at closing and over the life of the loan.

  11. Typically the starting rate for an adjustable-rate mortgage is lower than a fixed-rate mortgage. This results in the starting payments on an ARM being less than a fixed-rate mortgage on the same amount. It also means that you might qualify for a larger loan since this decision takes into account your current income and the first years of payments.

    Your Adjustable-Rate Mortgage might also be less expensive over a period as compared to a fixed rate if interest rates remain steady or move lower.

    Against these advantages, you might have to weigh the risk that an increase in interest rates would lead to higher monthly payments. In order to assess the risk you need to consider the following questions.

    • Is it likely that my income will increase enough to cover a higher mortgage payment if interest rates go up?
    • Will I have additional debts in the near future such as a new car?
    • How long do I plan on owning this home?
    • Can my payments increase even if interest rates generally do not increase?
  12. "Caps" are associated with Adjustable-Rate Mortgages. Caps limit how much the interest rate can increase or decrease. Periodic Caps limit the increase or decrease per adjustment period, whereas a lifetime Cap limits the amount the rate can increase over the life of the loan. For example, the lender may stipulate that the interest rate on an ARM can increase or decrease up to 2% per adjustment period, but not more that 6% over the life of the loan.

  13. NO. The lender arranges for PMI coverage on your loan. PMI products vary. When you apply for your loan, ask the lender what options are available.

  14. The terms of your mortgage will not change even if your loan is sold.

  15. Escrow payments are additional payments paid each month for the purpose of taxes, insurance, and PMI if necessary. The bank collects these payments from you on a monthly basis and is responsible for making timely disbursements of escrow funds to pay these bills.

  16. YES, you may make additional principal payments on your loan at any time.

  17. You will receive a monthly statement.

  18. You can make your payment at any bankHometown office, online from your bankHometown Checking Account, from your mobile device, from Pay Now, or return the payment by mail. Be sure to allow enough time so that it is received/processed by the due date.

  19. A Loan Estimate will contain estimates of all costs associated with obtaining your loan. It must be provided to you within 3 business days of your mortgage application.

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