DTI
Stands for debt-to-income ratio. DTI is the percentage of your gross monthly income that goes toward monthly debt payments and obligations. It factors in things like rent or mortgage payments, auto loans, credit card payments and alimony/child support payments. A smaller debt-to-income ratio improves your chances of qualifying with an advantageous rate.
SOME OF THE MOST COMMON LOAN TYPES:
- Conventional loans
- VA loans
- FHA loans
- USDA loans
- Jumbo loans
WHAT IS APR?
APR is short for Annual Percentage Rate. APR represents the cost of a loan over a year. It includes the interest rate as well as other costs and fees that come with your loan.
WHAT IS PMI?
PMI stands for private mortgage insurance. Mortgage insurance protects your lender’s investment if you default on your loan. It is normally required if your down payment is less than 20%.
WHAT IS THE DIFFERENCE BETWEEN A PREQUALIFICATION AND PRE-APPROVAL?
Prequalification means a lender has given you an estimate of how much you may qualify to borrow. Pre-approval is more official and means the lender has collected more info and sent it through underwriting.
CLOSING COSTS
Closing costs will vary depending on your situation, but they often include origination fees, appraisal fees, title insurance fees, closing attorney fee, association dues, property insurance and more. You will receive an estimate of closing costs from your lender, so you know what to expect.
SELLING A PROPERTY…OWNED BY A TRUST OR COMPANY
If the property you are selling is vested in a company or trust, there is additional information your closing attorney and real estate agent will need to collect. Please have your trust agreement, operational agreement, and/or articles of incorporation available to provide to your closing attorney and real estate agent for review. If you are unable to attend your closing in person, you will need to make arrangements with the closing attorney to set up a mail away closing or you may want to sign a Power of Attorney designating an Attorney-in-Fact to come to the closing and sign on your behalf.
COMPONENTS OF PITI (PRINCIPAL, INTEREST, TAX, INSURANCE)
