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Where to get a mortgage?


You have a number of options when it comes to picking a mortgage lender. Banks, credit unions, savings & loan institutions, mortgage companies, and individua…

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June 8 at 03:17pm · Comment · Read Full Answer · Share
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Where do I submit mortgage complaints?


It’s unfortunately inevitable that some borrowers will run into problems with their mortgage lenders given just how much money there is in play and how seriously people tak…

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June 8 at 03:02pm · Comment · Read Full Answer · Share
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Can I change the terms of my mortgage?


Given all that goes into picking a mortgage as well as how closely tied to the economy they are, it’s inevitable that people will look to alter the terms of their mortgages. …

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June 8 at 03:01pm · Comment · Read Full Answer · Share
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Who offers mortgages?


You have a number of options when it comes to picking a mortgage lender. Banks, credit unions, savings & loan institutions, mortgage companies, and individua…

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June 8 at 03:00pm · Comment · Read Full Answer · Share
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Should you find your home or mortgage first?


This might seem like a difficult question to answer because most of the time home sellers won’t sell unless they’re sure you can secure financing and lenders won&rsqu…

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June 8 at 02:59pm · Comment · Read Full Answer · Share
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How do mortgages work?

In general, a mortgage involves a lender paying the seller of a home whatever the buyer cannot afford at the moment.  The buyer, in turn, agrees to pay the lender back, plus interest, in monthly installment…

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June 8 at 02:56pm · Comment · Read Full Answer · Share
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What is a mortgage?

A mortgage is a home loan secured by the value of the property it is used to purchase. In other words, if you do not have the cash to buy a home, a mortgage lender can make up the difference as long as you ple…

Answer by: @WalletHub

March 29 at 07:06pm · Comment · Read Full Answer · Share
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Question
WalletHub's Answer:

You have a number of options when it comes to picking a mortgage lender.Banks, credit unions, savings & loan institutions, mortgage companies, and individual mortgage brokers all offer mortgages.But the truth is it doesn’t really matter from whom you get a home loan.


The 2008 Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) mandates that all mortgage lenders be licensed or registered as well as undergo a background check and pass certain educational requirements.What’s more, the National Mortgage Licensing System and Registry has a searchable database, and the National Association of Mortgage Brokers offers three levels of certification, each with a continuing education component.In short, it shouldn’t be too hard to find a qualified lender.


So, what does matter?The actual terms of your mortgage, of course.As is the case in the credit card industry, things like customer service are important with mortgages, but over the course of a 30-year mortgage, for example, sending in your monthly check will generally be the extent of your dealings with your lender.And since a mortgage is likely to be the most biggest expense you will ever incur, it makes sense to focus on minimizing its cost.


For example, if you lowered the interest rate on a $200,000 mortgage from 3.00% to 2.75%, your monthly payment would decrease by $26.73 and you’d save $9,622.80 over the life of the mortgage.You can also shop around to find the lowest lender’s fees and the cheapest discount points, which could also save you thousands of dollars.


In addition, getting the wrong type of loan and/or terms that you really can’t afford can really do some damage.A lot of people got into trouble during the Great Recession because they had taken out balloon mortgages and interest-only mortgages to lower costs in the early years with the hopes of flipping the properties before the other shoe dropped.When the housing market tanked, many could not sell their homes and eventually had to confront foreclosure and even bankruptcy.


So, our recommendation is to think terms first and then do some research on the lenders you’re considering.See where they’re registered, find out what certifications they have, read reviews, and ask friends and coworkers whether they’ve done business with them in the past.

Question
WalletHub's Answer:

It’s unfortunately inevitable that some borrowers will run into problems with their mortgage lenders given just how much money there is in play and how seriously people take issues relating to their homes.

And while there are a number of places where borrowers with grievances can file formal complaints, the best approach is often to first take a step back, rationally analyze the situation, and see if you and your lender can work things out directly. The advantages of doing so are threefold: 

  • Quicker resolution: Mortgage oversight and regulation is a governmental responsibility, and whether your complaint would need to be filed with a state or federal agency, you’d end up dealing with a bureaucracy. That means a lot of waiting before the issue in question is brought to a conclusion. However, if you are able to avoid bringing a middle man into the fold, you might be able to bring the issue to rest fairly quickly and then move on.
  • Potentially less hassle: First of all, there’s going to be some paperwork involved with submitting a mortgage complaint, and if the agency to whom you submit it decides to look into the matter further, you’ll likely have to provide additional details before going back and forth with the agency as your complaint goes through a resolution process. Talking things out with your lender and discussing potential solutions to your problem might not only result in less work overall, but it will also give you an idea of your lender’s thought process which could come in handy if you have to go the formal-complaint route.
  • A better working relationship: No lender likes to be reported to regulators, and you might be able to minimize animosity if you avoid submitting a formal complaint.

If either this does not work or your situation is serious enough to merit immediate governmental notification, there are a number of places where you can submit complaints at both the state and federal level. As you’ll see below, where you submit your complaint depends on whom you are complaining about.

  • National Banks: The Office of the Comptroller of the Currency (OCC) oversees national banks, and you can submit complaints to its Customer Assistance Group.
  • Savings & Loan: While the Office of Thrift Supervision (OTS) once regulated federally-insured savings and loan institutions, it was absorbed into the Office of the Comproller of the Currency in July 2011, so complaints can be submitted with the OCC.
  • State-Chartered Banks and Trusts: The Federal Reserve Board oversees state-chartered banks belonging to the Federal Reserve System, and complaints can be submitted to the Fed’s consumer help website.

    The Federal Deposit Insurance Corporation oversees state-chartered banks that do not belong to the Federal Reserve System, and you can submit a complaint by filling out a Consumer Assistance Form.

    You can also file complaints about state-chartered banks and trusts through their respective states themselves at the Conference of State Bank Supervisors website.
  • Federal Credit Unions: The National Credit Union Association (NCUA) oversees federal credit unions, and complaints can be submitted via the NCUA website.
  • State-Chartered Credit Unions: State agencies oversee these institutions, and complaints can be directed to your particular state agency’s website.
  • Other Mortgage Lenders: The federal Trade Commission is in charge of regulating other mortgage lenders, and you can submit complaints through the FTC’s secure online complaint form.
  • Federal Housing Programs: Complaints about Farm Credit Administration (FCA) members can be submitted through the FCA website, and issues relating to discrimination, land sales, and mobile homes can be made to the Department of Housing and Urban Development (HUD).

It’s important to note that reporting procedures for complaints likely vary between agencies, so it’s important that you determine what information you will need to provide. In addition, most agencies will also allow you to submit complaints via mail, e-mail, fax or phone if you’d prefer to do so rather than fill out an online complaint form.

Question
WalletHub's Answer:

Given all that goes into picking a mortgage as well as how closely tied to the economy they are, it’s inevitable that people will look to alter the terms of their mortgages.Those used to interest-only or balloon payments, for example, might experience payment shock when the principal kicks in or maturity comes, and when the economy is strong, everyone will want lower interest rates.However, changing the terms of your mortgage isn’t as simple as calling your lender and asking for a switch, perhaps quoting your history of on-time payments in the process as if you were requesting a credit line increase.


The only way to change the terms of your mortgage is to refinance.Refinancing is when another lender agrees to buy out your existing mortgage with a new one that has new terms.In other words, a second lender agrees to satisfy your debt with an original lender in return for you transferring to them the lien in the property.


Depending on the strength of the economy and the state of the housing market, refinance applications generally account for a 70-80% share of overall mortgage activity, which should tell you two things:1) refinance mortgages are extremely popular and 2) many people refinance multiple times.


Now, the obvious follow-up question to “can I change the terms of my mortgage” is “should I change the terms of my mortgage,” or perhaps more accurately, “should I refinance my mortgage”.


That, of course, depends on a number of different factors, namely:


  • The new terms you can get: You must determine to what extent the new terms you’d be likely to get would differ from your current terms.In addition to the interest rates, you should compare duration, loan type, prepayment penalties, etc.

  • How much you’d save: The goal of comparing potential new mortgages to your current one is to see just how much money you’d save by refinancing.As a result you must not forget to account for the closing costs of a refinance mortgage.

  • Mortgage rate trajectory: Are interest rates going down steadily Well, then you might get a better rate by waiting.Do you think rates have reached their nadir Then you might need to move quickly and make sure you can lock the rate you and your refinance mortgage lender initially agree upon.

  • Your goals: Finally, you need to consider whether a mortgage refinance and, in particular, the specific offers you’re considering would help you realize your financial goals.Do you just want to lower your required monthly payment Do you want to extend your amortization schedule back out to 30 years These are the types of questions you should be asking yourself.

Question
Who offers mortgages?
Ashley asked everyone
WalletHub's Answer:

You have a number of options when it comes to picking a mortgage lender.Banks, credit unions, savings & loan institutions, mortgage companies, and individual mortgage brokers all offer mortgages.But the truth is it doesn’t really matter from whom you get a home loan.


The 2008 Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) mandates that all mortgage lenders be licensed or registered as well as undergo a background check and pass certain educational requirements.What’s more, the National Mortgage Licensing System and Registry has a searchable database, and the National Association of Mortgage Brokers offers three levels of certification, each with a continuing education component.In short, it shouldn’t be too hard to find a qualified lender.


So, what does matter?The actual terms of your mortgage, of course.As is the case in the credit card industry, things like customer service are important with mortgages, but over the course of a 30-year mortgage, for example, sending in your monthly check will generally be the extent of your dealings with your lender.And since a mortgage is likely to be the most biggest expense you will ever incur, it makes sense to focus on minimizing its cost.


For example, if you lowered the interest rate on a $200,000 mortgage from 3.00% to 2.75%, your monthly payment would decrease by $26.73 and you’d save $9,622.80 over the life of the mortgage.You can also shop around to find the lowest lender’s fees and the cheapest discount points, which could also save you thousands of dollars.


In addition, getting the wrong type of loan and/or terms that you really can’t afford can really do some damage.A lot of people got into trouble during the Great Recession because they had taken out balloon mortgages and interest-only mortgages to lower costs in the early years with the hopes of flipping the properties before the other shoe dropped.When the housing market tanked, many could not sell their homes and eventually had to confront foreclosure and even bankruptcy.


So, our recommendation is to think terms first and then do some research on the lenders you’re considering.See where they’re registered, find out what certifications they have, read reviews, and ask friends and coworkers whether they’ve done business with them in the past.

Question
WalletHub's Answer:

This might seem like a difficult question to answer because most of the time home sellers won’t sell unless they’re sure you can secure financing and lenders won’t process a mortgage application until they know what you’re buying. However, the answer is simple: get pre-approved for a mortgage.

All preapproval entails is having a lender evaluate basic factors like your credit score, income, and debts to determine how much money they’d be willing to lend you, if any. This is merely a preliminary check to verify that you are an eligible borrower and does not take into account the specifics of any potential loan offer. You are not bound to accept a loan from the company that gave you pre-approval and do not need to shop around at this stage; you are basically just reassuring the seller about the state of your financials.

Preapproval also gives you a pretty good sense of what kind of home you can afford, and with it you can move on to house hunting. Once you find the property of your dreams and have a signed contract outlining the terms of the sale, you can shop around for the lowest mortgage rates.

So, to answer the original question, you should find your home before shopping for a mortgage, but before you do either one, get pre-approved.

Question
WalletHub's Answer:

In general, a mortgage involves a lender paying the seller of a home whatever the buyer cannot afford at the moment.  The buyer, in turn, agrees to pay the lender back, plus interest, in monthly installments over a certain period of time – usually 15 or 30 years.  A mortgage is secured by the home itself with a lien, which means if you do not make payments as agreed, the lender has the right to take the home from your control through a legal process called foreclosure in order to sell the home and recoup its money.


Mortgages usually have fixed or adjustable interest rates, hence the names Fixed Rate Mortgage (FRM) and Adjustable Rate Mortgage (ARM).  This simply means you will either have the same interest rate and thus the same monthly payment for the life of your mortgage or will have a rate that changes at specified intervals after an initial period of being fixed.  Mortgage payments are usually due on the first day of each month, and interest accrues on a monthly, not daily, basis.


In addition to both the principal amount you must borrow to purchase your home and interest payments, your mortgage expenses may include some hefty lender’s fees (e.g. application fees, underwriting fees, and processing fees).  By shopping around for your mortgage, you can not only lower your interest rate, but also the lender’s fees for which you will be responsible.


All mortgages in the U.S. are overseen by one government agency or another, and many are actually sold to government entities.  Fannie Mae, Freddie Mac, and Ginnie Mae – pseudonyms for The Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, and the Government National Mortgage Association, respectively – were founded to encourage building, buying and home ownership in the U.S., and insure a significant portion of the loans made in the U.S. each year.

Question
What is a mortgage?
Lauren asked everyone
WalletHub's Answer:

A mortgage is a home loan secured by the value of the property it is used to purchase. In other words, if you do not have the cash to buy a home, a mortgage lender can make up the difference as long as you pledge to both abide by an agreed upon payment plan and, in the event that you do not live up to your end of the bargain, forfeit your ownership of the home.


A mortgage is likely to be one of the most important financial products you’ll ever get simply because buying a house is likely to be one of the most expensive transactions you’ll ever make. Mortgages are also quite complex given the myriad factors that comprise them, the intricate differences between mortgage types, the breadth of mortgage industry jargon, all the numbers that you must somehow make sense of in order to get the best mortgage offer, and the logistics that come with purchasing a new home.


The most important parts of a mortgage are as follows:


• Principal: The amount you initially borrow. The principal plus your down payment equals the sale price of your home.


• Interest Rate: How much your principal grows due to the passage of time. Mortgage rates are either fixed, which means they never change, or variable, meaning they change on a recurring basis, usually after an initial fixed period.


• Duration: The time period in which you are required to pay off your mortgage loan.


• Lender’s Fees: The costs charged by a lender for the processing, review, and ultimate fulfillment of a mortgage application.


• Points: You can purchase a reduction of your interest rate by buying what are known as “mortgage points” or “discount points.”


When you take out a mortgage, you will also be required by your lender to purchase certain types of insurance. All borrowers have to get title insurance and homeowner’s insurance, and depending on where your new home is located, you may also have to get flood insurance.


You can get a mortgage from a number of different sources – including banks, credit unions, and mortgage brokers – but it’s important to remember that it really doesn’t matter where you get your mortgage, what matters is the terms you get. Also keep in mind that there’s a large secondary market for mortgages, which means your mortgage may get sold at some point, though your terms won’t change.


Finally, in order to fully answer the question of what is a mortgage, we must point out what a mortgage is not. A mortgage is not something to take lightly or to gamble with. Before taking out a mortgage, you should conduct thorough research and, most importantly, determine whether or not you will be able to make payments in the event of a financial emergency.


After all, you don’t want to lose your home when in between jobs or due to unexpected medical bills. You also don’t want to have a foreclosure on your major credit reports because it will remain for seven years, significantly damage your credit standing, and serve as a glaring red flag for other potential lenders.

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