Why use big box lenders and pay more for higher rates? At Wholesale Mortgage Rates, we strictly work through the wholesale channel to provide lower rates and lower costs mortgages to you, the borrower. I work with the nations best lenders to secure the best rates and pricing. As a Mortgage Broker, my overhead is low, therefore I'm able operate at lower margins, and I pass the savings on to you. In today's economy, and housing affordability steadily decreasing, securing a low rate, lower cost loan is imperative.
1. How do I know how much house I can afford? Answer
2. What is the difference between a fixed-rate loan and an adjustable-rate loan? Answer
3. How is an index and margin used in an ARM? Answer
4. What does my mortgage payment include? Answer
5. How much cash will I need to purchase a home? Answer
6. What does "Lender Credit" mean? Answer
7. What is the Loan Process? Answer
8. What type of fees can I expect? Answer

Q : How do I know how much house I can afford?
A : Generally speaking the rule of thumb is you can purchase a home 2 to 3 times your annual income. Keep in my that rule does not take into account other debt. Lenders will consider the Housing Debt to Income Ratio and the Total Debt to Income Ratio. Housing DTI is Principle, Interest, Taxes, and all Insurance divided by Gross Income. Total Debt Ratio is any and all debts reporting on your credit report,(possible undisclosed debt), plus PITI, divided by Gross Income. Keep in mind Lenders use "gross income" not "net income". Although a borrower might qualify on paper, doesn't always mean affordability.
 
Q : What is the difference between a fixed-rate loan and an adjustable-rate loan?
A : With a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, typically in relation to an index. While the monthly payments that you make with a fixed-rate mortgage are relatively stable, payments on an ARM loan will likely change. There are advantages and disadvantages to each type of mortgage, and the best way to select a loan product is by talking to us.
 
Q : How is an index and margin used in an ARM?
A : An index is an economic indicator that lenders use to set the interest rate for an ARM. Generally the interest rate that you pay is a combination of the index rate and a pre-specified margin. Three commonly used indices are the One-Year Treasury Bill, the Cost of Funds of the 11th District Federal Home Loan Bank (COFI), and the London InterBank Offering Rate (LIBOR).
 
Q : What does my mortgage payment include?
A : For most homeowners, the monthly mortgage payments include three separate parts:
  • Principal: Repayment on the amount borrowed
  • Interest: Payment to the lender for the amount borrowed
  • Taxes & Insurance: Monthly payments are normally made into a special escrow account for items like hazard insurance and property taxes. This feature is sometimes optional, in which case the fees will be paid by you directly to the County Tax Assessor and property insurance company.
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    Q : How much cash will I need to purchase a home?
    A : The amount of cash that is necessary depends on a number of items. Generally speaking, though, you will need to supply:
  • Earnest Money: The deposit that is supplied when you make an offer on the house
  • Down Payment: A percentage of the cost of the home that is due at settlement
  • Closing Costs: Costs associated with processing paperwork to purchase or refinance a house
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    Q : What does "Lender Credit" mean?
    A : The "Lender Credit" is a percentage, shown as a dollar amount, associated with the rate chosen after all rate adjustments. For example: 4.00% has a 2.00% credit after all adjustments. This means the borrower has 2.00% of the loan amount to apply towards 3rd party closing costs. This percentage could also be reflected as a negative number, which is called a discount, which would add to the total amount of closing costs. In general, as a borrower, obtaining the lowest interest rate, associated with the highest credit, will be the most cost effective.
     
    Q : What is the Loan Process?
    A : 1. Complete and submit your application with Wholesale Mortgage Rates, Inc. 2. We submit your application package to the lender for underwritten approval 3. Lender issues a "conditional approval" 4. You will gather and submit your conditions to Wholesale Mortgage Rates, Inc. 5. We submit your conditions for a "clear to close" with the lender. 6. Once cleared to close we will schedule the closing with you and that's it!!
     
    Q : What type of fees can I expect?
    A : Generally Speaking fees that are included in a mortgage loan are: Lender's Admin fee, Appraisal Fee, Flood cert, Tax Service fee, Tx Attorney Review Fee (Texas is an Attorney State), A range of Title fees, taxes and gov't recording fees, transfer tax fee, pre-paid homeowners insurance and escrow fees. Other fees applicable. "Lender Credit" associated with the locked rate could help offset these fees, or discount points could add to them. See "Lender Credits"