Below you will find the answers to some of the Frequently Asked Questions (FAQ). If you do not find an answer for your question, please call us at (877) 850-LOAN and we’ll be glad to respond to you.
Can I get a mortgage with a low credit score?
Insight Loans is the industry leader in Bruised Credit Mortgages. We can do mortgages down to a 560 credit score with a 10% down payment and a 580 credit score with a 3.5% down payment.
How long does it take to get a mortgage from start to finish?
The average time from application to closing is 30 days depending on several factors. Typically we tell clients to be prepared for 30 to 45 days.
If I’ve filed bankruptcy can I still qualify for a mortgage loan?
Yes, it is still possible to qualify for a mortgage. Insight Loans is the industry leader in Bruised Credit Mortgages. We have programs 1 day out Bankruptcy with a sizable down payment and 2 years out of Bankruptcy with a small down payment.
What documentation do I need to provide?
The documentation required for each loan differs depending on your situation. We always require income, employment, and asset verification, but sometimes we need additional items. Your Loan Officer will provide you with a list of items needed.
Are there any loan programs that don’t require a down-payment?
Yes there are loan programs that do not require a down payment such as VA and USDA loans. Please ask your Loan Officer to see if you qualify for these programs.
What is mortgage insurance and why is it required? Is there any way around mortgage insurance?
Mortgage insurance protects the lender against taking a financial loss in the event the mortgagor stops making payments. It is required on mortgage programs that require less than a 20% down payment. Mortgage insurance on a Conventional loan can be avoided by putting 20% down or doing “Lender Paid Mortgage Insurance” (LPMI). With this option, the lender pays the mortgage insurance, which is offset by a higher interest rate charged to the borrower. Ask your Loan Officer for details.
What are some of the benefits of Government loans (FHA, VA, USDA Rural Housing)?
These programs make it easier to purchase a home for those that otherwise may not be able to afford it. There are programs that require little or no down payments, no pre-payment penalties, and limit certain fees and charges the borrower must pay to establish the loan. These programs also have excellent rates.
How is my monthly mortgage payment applied to my mortgage loan?
Your monthly mortgage payment includes a payment to the principal balance, interest, and escrow, otherwise known as P.I.T.I. (principal, interest, taxes and insurance). The principal portion will decrease your balance owed each month while the interest goes to the Lender. The Taxes and insurance will go into your escrow account until those bills are due.
What is the difference between pre-qualification and pre-approval?
Pre-qualification is a lender’s judgment of your ability to make payments on your mortgage, based on your verbal statement of income, assets, and employment history. Pre-approval is an actual underwriting decision making you conditionally approved and is only subject to the lender’s final review of your title work, credit, appraisal and other determining factors.
What are “Seller Paid Closing Costs” and should I try to get them?
Seller Paid Closing Costs are costs that the Seller will pay on behalf of the Buyer at closing thus reducing the amount of money the Buyer needs at closing. These costs can be charges like Appraisal, Credit Report, Title Fees, Property Taxes and Home Insurance. It cannot go toward the Buyers down payment however. It is always a good idea to try
Is there a fee to submit my application?
No, there are no fees charged up-front. The appraisal will need to be paid for via the client’s credit card after the loan has been in process 3 days. If the loan does not close for any reason the borrower will be charged for any actual 3rd party fees Insight Loans has incurred such as credit report fees.
Once I’ve submitted my documentation, how long will it take before I know if I’ve been pre-approved?
Typically it takes 24-48 hours to receive a Preapproval.
What is the difference between the interest rate and the annual percentage rate (APR)?
The interest rate is the rate you agree to pay for your mortgage loan. It is used to determine the interest portion of your monthly payment. The annual percentage rate (APR) includes your interest rate and prepaid finance charges to give you an average yearly rate. Typically the higher the loan closing costs and Mortgage Insurance the higher the APR.
What is a discount point?
A discount point is generally 1% of the loan amount and is paid to the lender to buy down or lower the interest rate.
What is an escrow account?
Your monthly payment includes an amount which is placed in a fund held by the mortgage company to pay your annual property taxes and insurance premiums as they become due. This fund is referred to as an escrow account.
What is a rate lock?
A rate lock is an agreement between the lender and borrower guaranteeing the rate for a certain period of time. There are four components to a rate lock: loan program, interest rate, points, and the length of the lock. Typically a standard rate lock is either 30 or 45 days.
Can I use cash to purchase a home?
Cash is not allowed in a real estate transaction. If you have cash set aside you need to deposit it into your bank account and let it “season” for 60 days before applying for a mortgage.
Can I use Child Support or Alimony to qualify for a mortgage?
Yes you can as long as you have been receiving it for 6 months and can prove receipt. It must also continue for more than 3 years after closing to be used.