We have the answers to all your Frequently Asked Questions
What exactly does "pre-qualified" mean (or pre-approval vs approval)?
The term "pre-qualified" can have different meanings depending on the lender. A pre-qualification generally means that you have provided your personal information to the lender (including income, assets, and employment) and the lender has obtained a credit report and reviewed your credit history. If you receive a pre-qualification this means that based on your credit report and the information you provided to the lender, you will qualify for a specific type of mortgage up to a certain loan amount. An approval takes this a step further by submitting a full loan application to the lender, including income, asset, and employment information, such as paystubs and bank statements. An underwriter for the lender will review this information along with the credit report and make a final determination on your eligibility for a specific type of mortgage and a specific loan amount.
What are the benefits of VA loan?
Veterans have rightly earned special benefits in our country. One of the most treasured is the VA loan, which is issued by a private lender and backed by the U.S. Department of Veterans Affairs. A VA loan generally requires no down payment and, unlike most other loans with little to no money down, has no monthly mortgage insurance. VA guidelines are also more flexible to allow as many veterans as possible to realize the American Dream of home ownership.
What are closing costs?
Closing costs are fees associated with buying or refinancing a home. Even individuals paying cash for a home will have closing costs. The amount of closing costs vary based on whether or not you obtain a mortgage, the lender you use, and the type of loan you obtain. Closing costs are one-time fees due when you show up for your loan closing.
Can I still get a loan if I have bad credit?
Your credit score and history are important factors in determining your eligibility for a mortgage. That being said, poor credit does not make qualifying for a mortgage impossible. The best thing to do is talk to a licensed loan originator who can examine your entire financial situation and help identify potential paths to qualification or refer you to resources that can help you prepare for future home ownership.
What is an FHA loan?
An FHA loan is insured by the Federal Housing Administration (FHA). This insurance helps protect the lender in the event a borrower defaults on their mortgage, which in turn allows the lender to offer less restrictive guidelines. FHA loans are available for as little as 3.5% down.
How does refinancing work?
In most cases, refinancing is the act of paying off an existing mortgage on a home using a new loan that has more attractive terms. More attractive terms could mean a lower interest rate, a shorter loan term, or accessing the equity in your home for cash-in-hand. The loan process for refinancing is very similar to that of purchasing a home, however, some programs allow for 'streamlined' options which may not require employment, income or assets verification and/or an appraisal. A licensed loan originator will be able to help guide you to the best refinance option for your situation.
What type of mortgage should I apply for?
Buying a home is probably the largest purchase you’ll make in your life, and one of the most important decisions in the home buying process is choosing the loan to move forward with. Variables like the mortgage type, interest rate, loan amount, down payment, and term of the loan will differ based on each borrower’s circumstances. Working with a licensed loan originator will help you take inventory of your financial situation and make an informed decision about the type and terms of your mortgage. NRL Mortgage has a product portfolio that includes conventional loans, government-backed loans, and niche programs that offer flexible underwriting guidelines for borrowers in all walks of life.
What is a conventional mortgage?
A conventional mortgage is one that is not formally backed by any government entity, but instead is available through a private lender. Many conventional loans are referred to as ‘conforming loans’ because they 'conform' to guidelines established by Fannie Mae and Freddie Mac. These two government-sponsored entities (GSEs) purchase loans from lenders and then sell them to investors in what are called "Mortgage Backed Securities.” By purchasing these loans, Fannie Mae and Freddie Mac free up the lender's money so they are able to lend again, making mortgages more widely available.