Gift Fund Guidelines for Conventional Loans

Many people find it difficult to save for a down payment to buy their first home. That’s why it’s a big help when they receive a lump sum amount of money from a loved one that they can use to fund a down payment. It’s called a gift fund. Homebuyers taking out a conventional loan are required to follow guidelines if they will use a gift fund for their down payment. Lenders may not approve the mortgage if you could not prove the source of the gift fund.

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The Importance of Getting a Mortgage Pre-Approval

Getting a mortgage pre-approval, or simply “pre-approval,” is an important step in the homebuying process that you may want to consider if you want to fulfill your homeownership dreams. A pre-approval simply means that a lender initially determines that you qualify to take out a mortgage up to a certain amount. Obtaining a pre-approval from a lender could give you an edge especially when there’s a low inventory in the housing market.

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What Do First-time Homebuyers Need to Know About A Rate Lock?

When you shop for a mortgage, lenders will review all the information that you submit before giving you a Loan Estimate. Getting a “rate lock” or also called a “lock-in” is one of the decisions you’ll make as you compare Loan Estimates from different lenders. As a first-time homebuyer, it is important that you understand what rate lock means and how it works because it could affect the interest rate you’ll get once you decide which lender you will close a loan with.

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Typical Fees Associated in Refinancing a Mortgage

Many homeowners have been refinancing their mortgage to take advantage of the historically low interest rates. Aside from getting a low-interest rate, it makes sense to refinance your mortgage if you want to adjust the length of your mortgage term, change from an adjustable-rate mortgage to a fixed-rate mortgage, or if you want to cash out your home equity. However, if this is your first time to do refinancing, you need to be aware of the typical fees associated with it. Refinancing fees could go between 3 to 6 percent of your outstanding principal in addition to any prepayment penalties or other costs for paying off any mortgages you might have.

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6 Factors That Can Increase a Loan Estimate

A loan estimate is an important document that would-be homebuyers receive when applying for a mortgage. In general, the three-page document estimates everything that a homebuyer needs to pay for the entire loan. While loan estimates are designed to help homebuyers better understand the mortgage loan terms, there are some instances when the final Loan Estimate may be higher than what was originally quoted.

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Six Tips For A Smooth Closing

Buying a home is an exciting adventure that may also become a stressful life event, especially when delays throw plans off track. Follow these simple tips to avoid unnecessary delays and keep your purchase on schedule to ensure that you get into your dream home – on time!

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Understanding Residual Income for VA Loans

A VA loan is a type of mortgage backed by the U.S. Department of Veterans Affairs and is available to current service members, veterans and eligible surviving spouses. VA loans offer several advantages, including no private mortgage insurance (PMI) and no down payment required. When qualifying for a VA purchase or refinance, you need to meet certain minimum residual income requirements based on your requested loan amount, where you will be buying, and how many people will live in the home. Here’s how it works:

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