What is a Mortgage
The term “mortgage” refers to a loan used to purchase or maintain a home, land, or other types of real estate. The borrower agrees to pay the lending company or bank over time, typically in a series of regular payments that are divided into principal and interest. The property serves as collateral to secure the loan.
Tips for Getting Approved for a Mortgage
- Know Your Credit Score - Credit scores and credit activity have a major impact on mortgage approvals. Pay your bills on time, lower your debt, and review your credit report.
- Save Your Cash - A down payment is usually required for getting a mortgage. Getting a mortgage also involves closing costs, home inspections, home appraisals, title searches, credit report fees, application fees, and other expenses. If you are planning to purchase a new home, it is best to keep cash for your down payment and closing costs in an account that’s easily accessible when you are ready to buy.
- Stay at Your Job – Sticking with your employer while going through the mortgage process is important. Any changes to your employment or income status can delay or stop the mortgage process.
- Pay Down Debt – You do not need to have zero debt to qualify for a mortgage. However, the less you owe to creditors, the better. Your debt-to-income ratio determines how much of a mortgage you can be approved for.
- Get Pre-Approved for a Mortgage – The pre-approval process is straightforward. Contact a mortgage lender, submit your financial and personal information, and wait for a response. Pre-approvals include everything from how much you can afford, to the interest rate you’ll pay on the loan.
Types of Mortgages
- Fixed-Rate Mortgage* – With a fixed-rate mortgage, the interest rate stays the same for the entire term of the loan, as do the borrower’s monthly payments toward the mortgage. A fixed-rate mortgage is also called a traditional mortgage.
- Adjustable-Rate Mortgage (ARM)* – With an adjustable-rate mortgage (ARM), the interest rate is fixed for an initial term, after which it can change periodically based on prevailing interest rates.
*Actual rates and terms may vary depending upon property type and programs available.
For current rates, please call (715) 258-1400 and ask for our loan department.
To apply for a Mortgage Loan today, please complete our Online Application. Farmers State Bank of Waupaca NMLS #485154.