Q: What is a Mortgage Broker?

A: Mortgage brokers are trained and licensed financial professionals with access to a large network of wholesale mortgage lenders. What this means for our borrowers is that they get the most competitive pricing available and a service level that is unrivaled.

Being a broker gives us access to the best Conventional, FHA, VA, and USDA loan programs, as well as down payment assistance programs specific to Louisiana homebuyers. At the end of the day, our primary goal is to pair you with a loan that is competitively priced and fits all of your needs.

Q: What Factors Affect My Mortgage Rate? 

A: Typically, the combination of your credit score and your loan to value ratio (loan amount vs. value of home) is the single biggest factor in determining your rate.  Excellent credit would not have an adjustment to the interest rate, but the lower the score, the more risk to the lender. This results in a higher rate with a lower FICO score.

The amount of your down payment will also affect your interest rate.  The lower the down payment, the risker it may be to the lender, resulting in a higher rate. When borrowing more than the conforming loan amount of $424,100, you enter into a new tier of lending, called a Jumbo Loan. This too will increase your rate.

The term you choose, 30 year or 15 year mortgage will affect your rate.  The shorter the term, the lower the rate (usually).

Q: What should I bring to my appointment with InterTrust Mortgage? 

A: There are three parts of the mortgage process that will require information from you, the buyer. Requirements may vary or change at any time, but typically, your broker will prepare you over the phone or in person for your appointments and closing.

For Pre-Approval

• Full Legal Name
• Date of Birth
• Social Security Number
• Current Employment and income information
• Current Physical Address to cover a 2 year history

if self employed, a 2 year history of personal and business returns will be needed.
• Once a credit report has been pulled and income calculated, options will be put together to discuss the different loan programs available, together we will figure out which option fits your needs best. Loans are not one size fits all.

When You Are Under Contract 

• Copy of the signed contract
• Copy of a valid driver’s license
• Most recent 30 days of pay stubs
• Last 2 year of Federal tax returns, to include W2s, 1099s and K1s.
• Homeowner’s insurance quote
• Any remaining documents not given during pre-approval

During this step, the loan type will be finalized, and down payment, monthly payment/total out of pocket will be confirmed.

Underwriting

Once all documents requested have been received you can expect the following: Loan application will be sent to you to be signed (by e-mail or in person), and your interest rate will be locked in. At this time, an appraisal and title will be ordered, and your file will be submitted to an underwriter for review.

Once reviewed, the underwriter will send an approval with conditions (questions). Typical turn times on submitting a file until receiving conditions is 3-4 days, but can vary. Some examples of conditions that frequently surface are: explanation of large deposits into bank account, explanation on employment gap, etc.

Once conditions are gathered they will be sent back to underwriting for review. Typical turn times on submitting conditions to be reviewed is 2-3 business days.

Once the underwriter is satisfied with everything provided, a clear to close will be issued. Once the file is clear to close an exact date/time for closing will be scheduled.

When the clear to close is issued, a Closing Disclosure will be created which will itemize all of the final closing numbers and most importantly the amount to bring with you to closing.

This Closing Disclosure will be sent for review, and it must be signed 3 days before closing, day 1 being the day that it is signed. A typical loan will take approximately 30 days from start to finish, with the exception of Rural Development Loans, which can take up to 45 days pending Rural Development’s (U.S.D.A.’s) workload.

 

Things to Avoid:

There are important things that you can avoid to prevent negative impact on your credit, among other things. When in doubt, please don’t hesitate to ask your InterTrust Mortgage Lender, that’s what we are here for!

• Do not apply for other loans (car, boat, business, etc.) during this process. Your credit will be monitored during the entire process, and additional loans can have a negative impact on your credit score that could disqualify you from the original terms of your loan.
• Do not make large cash deposits or unexplainable deposits into your checking or savings account.
• Do not change jobs during the approval process. Verification of employment is done on the day of closing.

 

 

Q: What is PMI, and why do I need it? 

A: Simply put, on conventional loans, if you do not make a 20% down payment or have at least 20% equity on a refinance of your home, you will be required to insure your mortgage with private mortgage insurance (PMI) as a measure of reassurance for the lender to recoup losses in the event that you fail to make timely payments or default on your loan. When you reach the 20% equity in your home, you can request the PMI be removed, resulting in a lower monthly payment.

 

Q: Should I get an adjustable rate mortgage, or stick with a fixed rate loan? 

A: Fixed rate mortgages don’t change over the life of the loan. Though they can seem to translate to higher payments in some scenarios, they are more stable and dependable. Adjusted rate mortgages can go up or down, sometimes dramatically, based on the market index. If the market is strong, and you don’t plan on staying in your home very long, adjustable rates can sometimes be a good option. For most conventional loans, buyers typically enjoy the peace of mind of a fixed mortgage.

LOAN REQUIREMENT QUICK CHECKLIST

• Minimum 3% Down Payment for first time homebuyer

Minimum 5% Down Payment for all other buyers
• Minimum 620 Credit Score
• Down Payment May Be Gifted
• Non Occupying Co-Borrower Allowed
• PMI May Be Dropped By Borrower After Equity is Gained
• Subordinate Financing is Allowed
• Max Loan Amount is $424,100
• Primary, Second Home, and Investment is Allowed

• Minimum 3.5% Down Payment
• Minimum 620 Credit Score
• Down Payment May Be Gifted
• More Lenient Credit and Underwriting Guidelines Than Traditional Loan
• Non-Occupying Co-Borrower is Allowed
• Monthly PMI will Typically be Higher Than Conventional Loan
• PMI is for Life of the Loan
• Max Loan Amount is $275,665
• Primary Residence Only

• No Down Payment Required, 100% Financing
• No Credit Score Allowed, but Stricter Underwriting Laws Apply
• Lower Monthly PMI than Conventional or FHA Loans
• Household Income Limits Apply
• Home Must Be Located in Eligible Rural Development Areas, Typically Unincorporated Areas of the Parish
• Primary Residence Only
• No Max Loan Amount

• No Down Payment, 100% Financing Available
• Minimum 620 Credit Score
• No Monthly PMI
• More Lenient on Underwriting than Conventional Loan
• Must be a Qualifying Veteran
• Max Loan Amount is $424,100 (*JUMBO loan program available with down payment)
• Primary Residence Only

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