Frequently Asked Questions When Applying for a Mortgage (Pt. 8)

Robins Financial Credit Union is dedicated to our mission to be Member Focused, Financial Partners, Community Proud. We empower our members with the financial knowledge and resources they need to make informed decisions and achieve their financial goals.

Applying for a mortgage can seem like a daunting process, especially if you're not sure where to begin. As your trusted financial partner, we're here to simplify the journey. We know our members often have questions about the requirements, the steps involved, and how to set themselves up for success - and we're here to help.

In this article, we will dive into the answers to some of the most frequently asked questions with Mortgage Loan Originator, Angela Fellinger. Whether you're a first-time homebuyer or just looking to refresh your knowledge, this guide will give you the clarity and confidence you need to start your homeownership journey. Let us help you clear up the confusion and get one step closer to making your dream home a reality.

Q: What is a mortgage originator and what do they do?

Angela: A mortgage originator is your dedicated partner at the very start of your home buying journey. Think of them as your go-to resource for everything mortgage-related. Their role is to listen to your goals, gather the necessary financial information, and help you complete your mortgage loan application. Once they understand your specific needs, they'll educate you on the loan options available and guide you toward the best product for your situation. From application to closing, your mortgage originator is there to provide clarity and support.

Q: what is a first time homebuyer?

Angela: At Robins Financial, we define a First Time Homebuyer as someone who has never held an ownership interest in a property before. If this is your first time purchasing a home, you may qualify for special benefits designed to make the process more affordable. These include:

• A lower minimum required down payment
• No cost for the appraisal and credit report
• A reduced loan origination fee

These savings can really add up and provide a helpful financial boost for new homeowners.

Visit our website to find out more about our Affordable First Mortgage Loan.

Q: What is private Mortgage insurance, and do I need it?

Angela: Private Mortgage Insurance, commonly known as PMI, is a type of insurance that protects the lender in case the borrower defaults on the loan. If your down payment is less than 20% of the home's purchase price, PMI is typically required.

While PMI might seem like an added expense, it actually opens the door for many buyers to become homeowners sooner. By allowing you to buy a home with a smaller down payment, PMI can make homeownership more accessible - especially for first-time buyers or those without a large amount of savings.

Read our blog to understand how taxes and insurance can affect your mortgage payment.

Q: what is the difference between conventional loans and a government-backed loan (like FHA or VA)?

Angela: The primary difference comes down to who backs the loan:

• Conventional loans are insured by the federal government. Instead, they are offered and backed by private lenders like Fannie Mae and Freddie Mac. These loans often require a higher credit score and larger down payment, but may have fewer restrictions overall.
• Government-backed loans are insured by federal agencies. Two common types include:
  • FHA loans, backed by the Federal Housing Administration, are designed to help lower-income or credit-challenged buyers qualify for a mortgage.
  • VA loans, backed by the Department of Veterans Affairs, are available to eligible veterans, active-duty service members, and certain members of the National Guard and Reserves. VA loans typically require no down payment and have other unique benefits.

Each type of loan has its own advantages, and your mortgage originator can help you determine which option option is the best fit for your financial picture.

Next steps

Applying for a mortgage doesn't have to be overwhelming. With the right guidance and answers to your questions, you can approach the process with clarity and confidence. At Robins Financial Credit Union, we are committed to supporting you every step of the way.

• Visit our Knowledge Center to find more informational blogs about the homebuying process, various mortgage loans, and what you can expect at your mortgage loan closing.
• Tune into our YouTube channel to watch our Buying a Home series.

If you need assistance or have additional questions about applying for a mortgage loan, make an appointment to speak to one of our Mortgage Specialists today!

Read our other blog articles to help you gain the financial knowledge you need to succeed.

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