What is a mortgage loan

what is a mortgage loan

Bank of England

Get the facts about home mortgages from the experts at Bank of England Mortgage. Learn about different types of home mortgage loans and what to expect during the mortgage application process. Plus, find information about the current mortgage market and which mortgage myths you should never believe.

Home Mortgage Loan FAQ's

Bank of England Mortgage  is committed to serving to you realise and compare house personal loan loan options. So we have now compiled a list of some customary questions on mortgages that we often hear from our shoppers. When you do not to find the answer you're looking for, please contact us or chat with a live BOE mortgage loan expert proper now!
 
What is the typical home loan process?
 
A typical home mortgage loan process consists of 10 easy steps:
  1. Complete the pre-qualification worksheet
  2. Pre-purchase consultation with an BOE Mortgage home mortgage loan specialist
  3. Gather and prepare necessary documents
  4. Receive credit approval
  5. Obtain a property inspection
  6. Loan officer orders home mortgage loan documents
  7. Buyer obtains homeowners insurance
  8. BOE Mortgage loan experts update you on document status
  9. Seven-day pre-closing confirmation
  10. Easy, smooth, on-time closing!
 
 
What do I typically need to apply?
  1. W-2's for the past 2 years
  2. 2 most recent year-to-date paycheck stubs (within 30 days).
  3. Residence address - past 2 years and landlord information if applicable.
  4. Name and address of each employer - past 2 years
  5. 2 years' tax returns, if self-employed or commission.
  6. Last 2 months' bank statements for all checking, savings and retirement accounts (all pages included).
  7. Divorce Decree and 12 months' proof of child support. when applicable
  8. Address of other real estate owned.
  9. Loan information on all real estale owned.
  10. Payment for appraisal.
 
 
What's the difference between pre-qualification and pre-approval?
A mortgage pre-qualification is basically the lenders opinion of your ability to buy or refinance a home. Requires only basic information and no documentation or credit score. A mortgage pre-approval is the underwriter's decision that you are qualified. Credit check and documentation are required.

Once I sign my application am I committed to borrowing money?
No. Your pre-closing signatures are non-committal but only allow your mortgage banker to negotiate and approve you for a loan.

Internet Statements- Can I use them?
Internet statements are not allowed because they're not yet seen as completely unalterable by Fannie Mae or Freddie Mac. ALL PAGES of a required hard copy statement must be submitted (1 of 5 - all 5) even if the first page is an advertisement.

Who orders the appraisal and survey, and when is it ordered?
Your lender will order the appraisal and survey for you. (Unless your home is new construction and then your builder will order your survey) Most contracts have option periods that allow you to dictate when the appraisal and survey are ordered.
 
What does "locking my rate" mean?
Locking your interest rate refers to guaranteeing a specific interest rate for a specific period of time. Shorter lock periods usually have lower interest rates. For more information or to compare mortgages and rates, contact Bank of England Mortgage's qualified home mortgage loan experts or chat one-on-one now!
 
Do you "sell" your loans?
Bank of England Mortgage serves as both a broker and a banker- meaning we can either service or sell your loan, depending on what best fits your financial situation.
A mortgage banker will originate, process, underwrite, close and fund the loan in-house. Bank of England Mortgage is an affiliate of the Bank of England, England, Arkansas.

A mortgage broker will sell your loan to an investor who has guaranteed your loan program, and therefore your loan will be serviced and funded by that investor.
 
What are origination and discount points?
 Origination and Discount points are both a percentage of your loan. Usually 1% of the total amount of the loan (often tax deductible). Clients with low or no down payment can still obtain a loan, but will usually pay a slightly higher interest rate.
 
What is APR? (Annual Percentage Rate)
Usually higher than your quoted interest rate because it includes, in addition to interest, some of the additional costs of obtaining your financing.