What sets us apart from other mortgage lenders is our commitment to meet the needs of each and every customer through friendly, personal service.
Not only do we make the entire lending process easier and faster with the help of the latest technology and streamlined processes, but, with our large range of loan programs, we give you the means to realize your dreams, often for far less than you anticipated! Fairway Independent Mortgage believes that every consumer deserves to be treated as an individual, not as a number. Fairway Independent Mortgage and its loan originators and processors are committed to being accessible, attentive and caring. We are dedicated to enabling borrowers to buy the home of their choice, or to refinance, by finding the mortgage program most suited to their particular needs at the lowest rate possible.
Fairway Independent Mortgage - TEST FAQ
Q: What is the difference between loan prequalification, preapproval, and final loan approval?
A: a. Prequalification – is usually done over the phone using only a credit report and information supplied by the borrower verbally. Nothing is verified by the lender at this time. This should be your first step when you consider purchasing a home.
b. Preapproval – requires the borrower to provide all required documentation such as paystubs, w-2s, and bank statements among other things. The file will be reviewed and a preapproval letter issued. This is usually done once you find a property, and while the property documentation is being gathered such as the appraisal, and Title commitment.
c. Final Loan Approval – once all the documentation is approved by the underwriter, all the t’s crossed and I’s dotted, the file is then issued a clear to close (CTC), you are ready to sign papers on your new home at this point.
Q: What expenses are involved in buying a home?
A: Each loan type is different and has a unique set of underwriting standards. But, in general, you will have to pay your required down payment, Closing Costs and Prepaid items. Down payment is money you apply directly toward the purchase price of the home and reduces the loan amount. Closing costs are simply the cost of the items that must be obtained prior to final loan approval such as the credit report, appraisal, and other items. Prepaids are items that you pay in advance to set up your escrow accounts for taxes and insurance.
Q: What is the minimum down payment?
A: Minimum down payment varies for each type of loan.
i. Conventional loans have a minimum down payment of 3%. A down payment of 5% is normal on a conventional loan as the 3% option is typically at a higher interest rate and mortgage insurance premium.
ii. FHA loans have a minimum down payment of 3.5%
iii. VA loans have now down payment requirement, however, you must be an eligible veteran to receive this type of loan.
iv. USDA loans, also referred to as RD loans, do not require a down payment and allow you to finance to 102% of appraised value. USDA loans have income and property eligibility requirements.
Q: What is private mortgage insurance, and do I have to pay it.
A: Private mortgage insurance is insurance that is paid by the borrower to protect the lender in case of the borrower’s default. This allows the lender to make loans with higher loan to value (lower down payment). If we did not have private mortgage insurance, most lenders would require a down payment of 20%. You do not have to pay mortgage insurance unless your down payment is less than 20%.
Q: Should I pay points to buy down the interest rate?
A: Whether you buy points or not is a personal decision based on how long you are going to live in the home and how much of a payment change you can get for the points you are paying. For example: if you are going to live in a home for 7 years, and the cost to buy down the rate is 2% of the loan amount ($3,000) and the reduction in the principle and interest payment is $45, you would multiply the $45 * 7*12 = $3,780. So, in this case, you would have a profit of $780 over 7 years. However, if you intend to move within 5 years, the math is the same but the results are different. $45*5*12=$2,700. So, in this case, you would have lost $300 over that 5 year period. Not a good idea to buy points. If you are certain you will live in the home for 30 years, in this example, you would save $16,200 over the life of the loan. So it would make since to invest the $3,000. This is something you should discuss with your loan officer for exact details.