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mortgage 101
your quick guide to
What You Can ExpectH O M E L E N D I N G , L L C .
P r e s e n t e d b y
LINDA CARRASCOMortgage Loan Officer | NMLS 487501
Direct: 360.621.2001 [email protected]
www.TheCarrascoTeam.com
MORTGAGE LOAN TYPES
• Conventional Conforming loans
• FHA Insured loans
• VA Insured loans
• USDA loans
• Jumbo loans
Conforming Loans• 3% or 5% minimum required down payment available
• 50% maximum debt-to-income ratio
• 620 minimum FICO credit score
• $484,350 maximum loan amount
• PMI (Private Mortgage Insurance) required with less than 20% down payment
• Seller contributions allowed depending on the loan-to-value
Conventional
*additional requirements may apply
Insured Loans• 3.5% minimum required down payment• No income limit, not limited to first-time homebuyers• Flexible debt ratio is limited to 50% (additional credit score requirements apply)• 580 minimum FICO credit score with AUS accept• Maximum loan amounts based on county• MIP (Mortgage Insurance Premium) upfront and monthly• Seller contributions up to 6%
FHAFHA
*additional requirements may apply
insured Loans• Must have VA eligibility • Up to 100% financing, no down payment• No mortgage insurance• $484,350 maximum loan amount up to 100% financing• Loan approval subject to sufficient residual income with max debt ratio of 41%
(can exceed 41% with acceptable compensating factors and 120% residual)• Seller contributions limited to 4%
VA
*additional requirements may apply
guaranteed Loans
• Property determines eligibility• Up to 100% financing, no down payment required• No mortgage insurance• Maximum debt ratio 41%• 640 minimum FICO credit score
USDA
*additional requirements may apply
non-conforming Loans
• 10% minimum down payment• Loan amounts above $484,350• 680 minimum FICO credit score• 6-48 months of PITIA (Principal, Interest, Taxes, Insurance, and
Homeowner Association Dues) required in reserves
JUMBO
*additional requirements may apply
NAVIGATING
TRID• What is TRID?
• How does TRID impact processing time?
• What can we do to stay on track?
GENERAL LOAN process timeline
• Prequalification / PQ Link / Loan Officer’s Website
• Conditional Approval • Contract• Disclosures• Loan documents• Processing• Underwriting• Loan conditions• Closing
interest rates
• Rate float• Rate lock• How to use interest rates to decrease debt ratio• How to use interest rates to generate closing costs credit
WHAT’S CREDIT GOT TO DO WITH IT?
• Type of loan program
• Interest rate and terms
• Loan approval
Along with other financial factors, credit score affects:
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WHAT MAKES UP AFICO CREDIT SCORE?
PAYMENT HISTORY
OUTSTANDING BALANCES
LENGTH OF CREDIT HISTORY
NEW CREDIT INQUIRIES
MISC. FACTORS
15%
10%
10% 35%
30%
*Source: http://www.myfico.com/crediteducation/whatsinyourscore.aspx Source is deemed reliable but is not guaranteed.
PAYMENT HISTORY: 35% OF SCORE PAY ALL CREDIT ACCOUNTS ON TIME
OUTSTANDING BALANCES: 30% OF SCORE
OWE LESS THAN AVAILABLE CREDIT LIMIT
LENGTH OF CREDIT HISTORY: 15% OF SCORE SHORT HISTORY MAY NOT NEGATIVELY IMPACT
SCORE IF RESPONSIBLE CREDIT MANAGEMENT IS SHOWN
NEW CREDIT INQUIRIES: 10% OF SCORE
KEEP CREDIT INQUIRIES TO A MINIMUM
Mortgage inquiries are exempt – only count as ONE within 30 days
MISC. FAC TORS: 10% OF SCORE SMALLER FACTORS – LIKE VARIETY OF CREDIT TYPES –
COULD INDICATE LONG HISTORY AND LEAD TO HIGHER SCORE
WHAT ARECREDIT SCORE RANGES?
FICO scores range from 300 – 850Higher the number, the BETTER
• Shows if a borrower can afford their monthly mortgage payment
• Listed as a percentage of income that is spent on monthly debtWHAT IS
DEBT-TO-INCOME RATIO (DTI)?
Borrower’s Monthly Debts
Borrower’s Pre-Tax Income
WHAT QUALIFIES AS “DEBT” FOR A MORTGAGE LOAN?
Items listed on a
credit report – car
loans, mortgages,
credit card payments,
etc.
NOT utility bills,
health insurance,
car insurance
THANK YOU FOR ATTENDINGP L E A S E L E T M E K N O W H O W I C A N H E L P Y O U
9564 Silverdale Way NW., Ste. 100 | Silverdale, WA 98383 | WA: CL-1103299 (NMLS 1103299) | Company NMLS 1031451Not a commitment to lend. Borrower must meet qualification criteria. Equal Housing Opportunity.
LINDA CARRASCOMortgage Loan Officer | NMLS 487501Direct: 360.621.2001 [email protected]
