Q: What items will I need to complete my on-line loan application?

A: When completing your online application you should have in front of you the following documents: (1) Copy of pay stub, (2) Copy of most current bank statements, (3) If your loan is a refinance your existing lenders name, phone number and your loan number, (4) current property tax information and (5) your current home owners insurance information.

Q: How long does it take to process and close my home loan?

A: Loan processing and closing usually takes anywhere between 10 to 30 calendar days. Mortgage Loans of America, LLC can complete its underwriting decision normally within 24 hours. However, because mortgage loans require a title search and sometimes a physical appraisal the process can take longer depending on the work load of the title and appraisal companies.

Q: What is a conforming Loan?

A: A conforming loan is a loan amount less then $322,700. Our conforming loans follow the national underwriting standards of the Federal National Mortgage Association.

Q: What is PITI?

A: PITI stands for Principal, Interest, Taxes and Insurance. The "Principal and Interest" is the mortgage loan payment, "Taxes" represents 1/12 of your annual property tax payment and "Insurance" represents 1/12 of your home owners insurance. Together PITI represents your total monthly housing payment or obligation.

Q: What will my monthly payment include?

A: Your monthly payment will include the “Principal and Interest payment” (loan payment) and in some cases will include 1/12 of your annual property taxes and 1/12 of your annual home owners insurance.

Q: What is a Rate Lock or What does "Rate Lock" mean?

A: A rate lock is a contractual agreement between you and the lender guarantying you a specific interest rate for a defined period of time no matter what market movement there is.

Q: What is Loan To Value (LTV)?

A: Loan To Value (LTV) is your requested loan amount divided into the appraised value of the property.

Example: $80,000 requested loan, $100,000 appraised value yields
80,000/100,000 = 80.00% LTV

Your LTV can be important in establishing your interest rate, qualification factors, whether or not you need private mortgage insurance and pricing.

Q: What are closing costs?

A: Closing costs are divided into two categories. (1) recurring and (2) non-recurring. Recurring closing costs are third party and lender charges associated with the processing and closing of your loan request. Non-recurring costs are fees you will always have with home ownership such as home owners insurance and property taxes.

Q: What is Private Mortgage Insurance (PMI)?

A: If your loan to value is greater than 80.00% some loans require Private Mortgage Insurance. If you're required to purchase private mortgage insurance this is not insurance to protect you against disability, loss of job or death. This insurance protects the lender in case of loan default.

Q: How do I qualify for a home loan.

A: Loan qualifying can be divided into 4 parts.

1. Income qualification – Do you make enough income to make your loan payment and pay your other monthly obligations (ie credit cards, car loans, etc.)?
2. Credit qualification – Does your credit show the lender you will make the payment?
3. Property qualification – Is the value of the property sufficient for the requested loan?
4. Reserves – After the loan closing do you still have some money in the bank for a rainy day?

Q: What is a no cost loan?

A: There is no free lunch. A no cost loan is where the lender pays all your non-recurring closing costs. The lender does this is by giving you a much "higher than market" interest rate and uses the higher yield to pay your fees. It is very rare that this type of loan is good for you. In other words you the borrower will pay a higher rate for potentially 30 years just to have the lender pay a few dollars in fees.

Q: What loan programs does Mortgage Loans of America, LLC offer?

A: Mortgage Loans of America, LLC offers fixed rate loans with amortization from 10, 15, 20, 25, and 30 years. We also offer balloon loans at 5 and 7 years terms, adjustable rate loans, fixed rate, second mortgages, home equity lines of credit, 100% financing loans, stated income loans and VA loans.

Q: What will I need if I’m self employed?

A: Mortgage Loans of America, LLC offers full documentation, light documentation and no documentation loan programs for self employed. Full documentation requires two years of tax returns, light documentation requires 6 months bank statements and stated documentation requires no income documentation at all.

Q: What are the appraisal costs?

A: With Mortgage Loans of America, LLC there are no appraisal costs. All appraisal fees are paid for by Mortgage Loans of America, LLC

Q: What is a cash out refinance and why does it costs more?

A: Effective February 1, 2003 the nation lending standards for FNMA (Federal National Mortgage Association) loans had a dramatic change.

(1) A conforming loan is deemed cash out if, at closing after the old loan, liens of record and closing costs are paid the borrower receives greater than 2.00% of the new loan back to them.

Example $100,000 new loan
- $ 90,000 pay off of old loan
- $ 1,000 closing costs
$ 9,000 cash back to borrower (this is a cash out refinance)

(2) A conforming loan is also deemed cash out if the borrower has an existing second mortgage on the property (this includes home equity lines of credit, home improvement loans, etc) that was not originally 100% used to purchase the home.

Because FNMA determined there is a greater risk of default for cash out Conforming loans rates and fees after February 01, 2003 can be much higher.

Q: What is a credit score, and why are they important?

A: When your credit report is pulled by the mortgage lender usually three credit bureaus are pulled (1) Transunion, (2) Equifax and (3) Experian. Each of these bureaus assigns a credit score to you, the borrower. These scores range from 0 to 800. The Higher the score the better your credit. The better your credit, the better the interest rate you qualify for.

Q: What is equity?

A: Equity is defined as the difference in the value of your home minus the outstanding balance of any loans against your home.

Example:
$200,000 home value
-$150,000 existing loans
$ 50,000 equity

Q: What is a point, and should I pay them?

A: One point equals one percent of your requested home loan. In many cases points can be financed into your new home loan request.

Example: $80,000 loan request, one point would equal $800.00

Usually it does make sense to pay points if you can recapture the cost in a period of time that is less than the amortization of your new loan.

Q: What kind of security does the Mortgage Loans of America, LLC web site have?

A: Our web site uses a Secure Socket Layer (128 bit -strong- encryption) when transferring your personal data.

Q: What kinds of property does Mortgage Loans of America, LLC lend on?

A: Mortgage Loans of America, LLC performs home loans on Single Family residences, Condos, town homes, modular homes, rural property and multi family homes up to four units

Q: What is a Jumbo Loan?

A: A jumbo loan is a loan amount greater then $330,000

Q: When does it make sense to refinance?

A: The right time to refinance is strictly up to you. If you can lower your monthly obligation payments or shorten the term of your mortgage it usually makes sense to refinance.

Q: What is a good faith estimate?

A: A good faith estimate is the lenders estimate of the costs you will need to pay to complete your loan request.