Your Guide to Home Ownership
Tae Ho Kim
Home Loan Originator
Compass Home Loans
MLOC # 1194719
Home ownership is one of life’s major events, and it provides some unique personal and financial rewards. There are many advantages of home ownership. It can provide lasting stability and security as well as a place for relaxation at the end of the day.
Here are a few things to consider if you’re still undecided on whether to start the home buying process:
• Home ownership may offer you important tax benefits
• You’ll have the potential to build equity. This is the portion of your home that you’ve paid for, plus any rise in its value
• You can decorate and remodel your home to suit your personal taste
• It’s a potential investment, since your home’s value may appreciate over the years
• You won’t have to worry about your rent going up when your lease expires, or having to move if your rental property is no longer available or affordable
TIMELINE FOR HOMEBUYERS
1. Meet with a Mortgage Loan Originator to discuss your home financing options.
2. Pre-qualify for financing before you begin viewing homes.
3. Shop for a home – Work with a local real estate agent to find a home that suites your needs.
4. Submit an offer – if accepted, put down your earnest money deposit.
5. Complete a loan application – your Mortgage Loan Originator will assist you.
6. Arrange a home inspection and review results of your home’s appraisal.
7. At closing, you’ll sign your loan documents and finalize your purchase.
8. The title officer will ensure your deed, mortgage and other necessary documents are recorded. 9. Move into your new home and relax!
LOOK AT YOUR HOUSEHOLD FINANCES
Before you discuss your mortgage options with your Mortgage Loan Officer, you should review your finances. This includes your monthly household budget, any current debts, and long-range financial goals. This will help you decide how much you can spend on a home. Next, your Mortgage Loan Originator will estimate an affordable payment.
How your credit score affects your loan:
Your credit or FICO score plays a major role in home financing.
• Almost all mortgage approvals require a minimum credit score.
• Your score affects your loan’s interest rate. Generally, a higher score earns you a lower interest rate and more loan options.
• There are loan programs available for buyers with minimal credit histories and less-than-perfect credit.
• After helping you complete your loan application, your Mortgage Loan Officer will ask your permission to order a credit report.
CHOOSING THE RIGHT HOME LOAN AND UNDERWRITING
There are a variety of loan programs available to fit different financing situations. Your Mortgage Loan Officer will assist you in choosing the right loan program to meet your needs based on a variety of factors such as down payment amount, credit score, etc. Once your Mortgage Loan Officer has completed your loan submission they will send your application and supporting documents to the underwriting department. An underwriter compares your application details to the conditions of your loan and verifies your income, employment, and credit history before approving your loan. During this time, your Mortgage Loan Officer will contact you and let you know the status of your application, and if you need to produce additional documents. Keep in mind that if your income or credit card balances change during the underwriting process, your Mortgage Loan Originator will need to know as soon as possible. Any changes in your financial situation may delay your loan closing or even jeopardize your loan approval. After the underwriter approves your loan application, your Mortgage Loan Officer and Realtor will help you get ready for the closing process.
After you sign the documents, they’ll be delivered to the funding department. Once your closing paperwork is reviewed, your loan will be funded.
NEW PROJECT LENDING
If you decide to purchase a home in a project development where construction is not complete, there are a few things to keep in mind.
TimelineBeing that your transaction may run over an extended period of time, (time to construct), you should try to maintain stability in your financial situation. If there are any changes in employment, income or assets used for down payment or closing costs, you will want to inform your lender as soon as possible.
LocksWhen purchasing a home that has not been constructed yet, it would be wise to talk to your Mortgage Loan Officer early in the process about rate lock options. You may have the ability to lock in your interest rate for a longer term to protect you from any potential rate increases should they occur.
At Compass Home Loans we have a variety of loan programs to suite your needs whether you are purchasing a home in a new project or a home that has already been constructed. To obtain more information on Compass Home Loans, or to schedule a no-obligation consultation with one of our Home Loan Originators, please feel free to call us at (808) 518-3650 or visit our website at www.compasshawaii.com
Compass Home Loans, LLC is licensed as a Hawaii Mortgage Loan Originator Company and a sponsored third party originator authorized to originate FHA and VA loans. NMLS# 1194719 (www.nmlsconsumeraccess.org). Compass Home Loans, LLC is regulated by the Hawaii Division of Financial Institutions, and offers many loan products. Contact a Compass Home Loans Representative to learn more. This is not a commitment to lend. 2016 Compass Home Loans, LLC. All Rights Reserved.