Home Financing Guide

Home Financing Guide

A S u b s i d i a r y o f To w n e B a n k

Dear Homebuyer, Buying a home for many people is the biggest and most important investment of their lives.

The process of choosing and obtaining the right mortgage for your unique situation is an important step in assuring that your money is working to your greatest advantage, now and into the future.

We take pride in our ability to work with you to find a practical mortgage solution with terms that meet your needs.

Our commitment to the mortgage industry means we keep informed of the latest developments in housing finance. You’ll have all the best options available to you as we work together to finance your home.

We hope that you will partner with us for a home financing experience that gives you a feeling of confidence and security, so you will get exactly what you need. We are here to help you!

Why Should You Finance Your Home With Us? YOU DEAL WITH ONE PERSON As your personal loan consultant, we will get to know you and your unique needs. Then, we will tailor a loan product for a perfect financial fit.

ACCESSIBILITY & KNOWLEDGE We are accessible directly to update you on the status of your loan or to answer any questions you may have.

ALL DECISIONS ARE MADE QUICKLY AND EFFICIENTLY Your loan is kept close at hand, because all decisions are made here.

WE ARE HOME LOAN EXPERTS Home loans are what we do. We have an array of innovative loan products, great rates, and comprehensive local service every step of the way.

CLOSE ON TIME Your closing date is as important to us as it is to you.

Meeting your closing date is our number one priority.

6 Tips For First Time Homebuyers 1.

DISCOVER HOW MUCH YOU CAN AFFORD Make sure you are saving enough toward retirement and other goals when deciding how much to spend each month on mortgage payments. Speaking to a mortgage loan officer to get pre-qualified will give you an idea of the price range you should be looking for.

2.

REMEMBER THE COSTS OF HOMEOWNERSHIP Remember to plan for homeowners insurance, property taxes, private mortgage insurance, utilities, repairs, and maintenance. Your Loan Officer can give you an estimate of these expenses.

3.

RESEARCH NEIGHBORHOODS Prioritize what you are looking for in a neighborhood.

Then talk to the people that live in the neighborhoods you are interested in.

4.

LISTEN TO YOUR REALTOR® A Realtor’s job is to know how much properties are worth.

A well-chosen REALTOR® will do his or her best to help you negotiate on the “home of your dreams”.

5.

INSPECT THE HOUSE Hire a full-time, professional home inspector.

Again, referrals from friends, relatives, co-workers and your Realtor® are a good place to start.

6.

PREPARE FOR CLOSING Closing costs can run in the thousands of dollars and you will want to have enough money to pay for them. Your loan officer can help you through the process.

Mortgage Options WE PROVIDE THE RIGHT FIT FOR YOUR HOME FINANCING NEEDS VA (Veterans Administration)

• Up to 100% financing for military veterans, active duty military or eligible reservists • Flexible qualifying guidelines FHA (Federal Housing Administration)

• Not limited to first-time homebuyer • Loan amount limits and property eligibility apply FHA 203k (Rehabilitation Lending)

• Allows repairs on qualified “fixer upper” properties • Cash needed for repairs included in the loan PHFA (Pennsylvania Housing Finance Agency)

• Down Payment assistance of up to $6,000 • Programs with 3% down and no mortgage insurance • Combine PHFA with VA/USDA/FHA guidelines • Income limits apply to most programs USDA (Rural Housing Program)

• Not limited to first-time homebuyer • Income limits and property eligibility apply CONVENTIONAL

• Programs with as little as 3% down • Fixed and adjustable rate options • Jumbo financing also offered • Second home and investor loans

Tips For a Smooth Loan Approval DON’T × Don’t make a major purchase (car, boat, jewelry). × Don’t apply for new credit (even if it says pre-approved). × Don’t open a new credit card.

DO

CONTINUE a DO MAKING MORTGAGE OR RENT PAYMENTS

STAY CURRENT a DO ON ALL EXISTING

× Don’t transfer any balances from one ACCOUNTS account to another.

a

× Don’t pay off collections without a DO CONTINUE WORKING AT discussion with the Loan Officer first.

CURRENT EMPLOYER

× Don’t buy any furniture or appliances. × Don’t close any credit card accounts. × Don’t change bank accounts. × Don’t deposit any money other than normal paychecks. × Don’t max out or over charge on credit cards accounts. × Don’t consolidate your debt onto 1 or 2 credit cards. × Don’t take out a new loan. × Don’t start any home improvement projects.

KEEP THE a DO SAME INSURANCE COMPANY

CONTINUE a DO LIVING AT CURRENT RESIDENCE

CONTINUE a DO TO USE CREDIT AS NORMAL

a

× Don’t finance any elective medical DO CALL THE procedure.

LOAN OFFICER IF × Don’t open a new cell phone account.

YOU HAVE ANY × Don’t join a new fitness club.

× Don’t pay off any loans or credit cards without discussing it with the Loan Officer first. × Don’t change jobs or retire without first discussing with your loan officer.

QUESTIONS

Mortgage Loan Checklist Use this checklist to ensure you have everything together for your loan application. Having all necessary documentation up front saves time so your loan closes smoothly and quickly.

Addresses for previous 2 years’ p

rental or mortgage history

Name, address and phone p

number of all landlords for past 2 years (if applicable)

Name, address and phone number p

of employers for past 2 years (include dates and explain gaps)

All pay stubs for the most recent p

30-day period

Verification of other income-child p

support, alimony, retirement, or social security awards letter

Past 2 years’ signed personal tax p returns including all W-2’s

Self-Employed- Past two years’ p

signed personal tax returns, corporate or partnership returns including YTD P/L statements, balance sheets, K-1 and 1099’s

Most recent 2 months’ statements p

for all bank, investment and/or retirement accounts (all pages)*

*Explain all deposits that are not normal direct deposit payroll

Copies of separation/divorce decree p All bankruptcy papers including p

discharge and explanation

Sales Contract- legible copy p

Valid Driver’s License or Military ID p VA Loan Applicants- Statement p

of Service from your Command or copy of your DD-214, Member Copy 4, so we can order your Certificate of Eligibility

Attorney name and number p Homeowners insurance info p Check or Money Order for p

Credit Report

REFINANCE Copy of Mortgage Statement p

for each home loan

Copy of current survey p Copy of Homeowners Policy p

(Declaration Page)

Subordination? p Copy of deed p Copy of Title Policy p

Make The Move Checklist Ready to move into your new home? Here are a few things to keep in mind: Do you have the keys to your new home? p Do you have access to the garage door opener p

and/or keypad?

When is the garbage and recycling picked up? p Any last minute tips about the house- keys, locks etc. p Do you have all of the booklets and pamphlets p

for the house and other household items?

Have you received the sellers’ forwarding address? p Have you met your new neighbors? p Are there any annual neighborhood parties or activities p

you’d like to know about?

Have you called to change the utilities? p Are there any invoices or warranties for past p

work completed?

Glossary of Mortgage Terms ADJUSTABLE RATE MORTGAGE: A mortgage with an interest rate that is periodically adjusted based on the movement of a specified index.

APPRAISAL: A report which evaluates the condition and value of real estate.

CLOSING COSTS: Fees to cover expenses incurred in a real estate or mortgage transaction. Usually include: survey, premiums for title insurance, cost of title examination, attorney fees, recording charges and other customary lender charges.

CONVENTIONAL MORTGAGE: A loan underwritten in accordance with the guidelines established by FNMA, FHLMC or a private investor and insured by a private mortgage insurance company.

ESCROW PAYMENT: The portion of a monthly mortgage payment held by lender to pay taxes and certain types of insurance on the home.

FIXED RATE MORTGAGE: A mortgage with an interest rate that does not change over the life of the loan.

FHA LOAN: A loan insured by the Federal Housing Administration and underwritten to its guidelines.

LOAN-TO-VALUE RATIO: The ratio of the mortgage loan amount to the property’s appraised value or lesser of the purchase price.

MORTGAGE/DEED OF TRUST: A document pledging property as security for payment of a debt.

ORIGINATION FEE: A fee or charge for work involved in the evaluation, preparation, submission and closing of a proposed mortgage.

PITI: Shorthand for principal, interest, taxes and insurance, which are the components of the monthly housing expense.

VA LOAN: A mortgage for an eligible veteran which is guaranteed by the Veterans Administration and underwritten according to its guidelines.

PHFA LOAN: A loan given by the Pennsylvania Housing Finance Agency.

A S u b s i d i a r y o f To w n e B a n k NMLS# 1054689

I will guide you through the mortgage process each step of the way.

Please contact me with any questions you have or assistance you may need concerning the home buying process.

Deirdre Petrie

Mortgage Loan Officer NMLS #141482 Direct: 610-763-8976 deirdre.petrie@homesalemortgage.com www.homesalemortgage.com/deirdrepetrie This is being provided for informational purposes only and is not a commitment. Actual loan qualifying is subject to verification and approval of income, credit, property, appraisal and other factors. Rates, fees, and programs are subject to change. *A full or partially funded set aside of proceeds may be required for payment of property charges on the new loan. Home must be occupied as principal residence, required taxes and insurance paid and make all necessary repairs to avoid deterioration of the property.

When the house is sold, the loan, along with any interest and fees, are paid to the lender.

Any remaining equity belongs to you or your heirs. Advertising materials are not provided or approved by the Department of HUD or FHA.