Mortgage 101 (insurance, loan, interest rate, real estate)

[SouthSeasLifestyler]

So, being new to your country and state, and wanting to buy a house when we get there, I ordered a couple of US books on mortgages to educate myself about this very big and important financial undertaking. Let's just say I was shocked by the quality of the books (this was after pouring over the reviews on Amazon). The authors were so full of themselves and how clever they were ... and all the info on mortgages was more or less already what I already got off the internet. I wanted a practical, cool, nuts-n-bolts discussion on mortgages, specifically all the contractual variations and practices post-2008. But I don't think it sells as well as some sensationalist take on real estate ... for example, neither book even said what happens when you sell a home and have a mortgage. Or about repayment penalties, etc.

So I thought I'd come and see if anyone else would recommend me another book or other websites where I can really get my head around the actual anatomy of a mortgage? With some luck I'll be able to order and read the book before I set foot in WA.

I would like something with a lot of detail, which explains the effects of parts of the mortgage agreement, without being too swamped in legalese.

SSLifestyler

[bmw335xi]

You can find that information by using google.

"how to get a mortgage"
"the mortgage process"
etc

[clutchrider]

My advice would be to contact an actual mortgage company. Not a bank, not a credit union, but a Mortgage business. They will be happy to talk to you and answer any questions. Our officer is amazing and has been up front and beyond helpful through the whole process. I would have never gotten this kind of attention from the bank.

[bmw335xi]

^^ This is good advice, but make sure the mortgage broker has good reviews or at the very least, no complaints etc. The market crash got rid of many predatory and idiotic mortgage loan originators, but they still exist.

[Modification Specialist]

Mortgage 101- four things to understand

1) Your credit score - the higher your score is the lower the interest rate. The lower your score is, the higher is interest rate.
2) Your Loan to Value score - this is the amount of equity vs the amount of your loan. The more you put as a down payment, the more equity you have and the lower the LTV.
3) Your debt to income score - the more bills (debts) your have the higher the DTI. The less debts your have, the lower the DTI score.
4) the most stable loan is a 30 year fix rate mortgage with your home owners insurance and mortgage taxes included in the payment.

I have worked with mortgages for many years and still learn new things almost every day. The reason is everybody has a different situation. An analogy is like a card game - I'm the dealer and with each client have to look at their cards to see what they have to win.

In my opinion buying books are worthless, because your trying to understand things that will not apply to you. I agree Google is a good place to find questions, however almost each answer you find might be slightly different from your situation.

Know this - if you want the best loan, focus on your credit score. Learn what credit is and how important it is to your future. A key point to understand with a mortgage, if you send extra with your money payment, this will shorten your term, increase your equity faster, lower your net effective rate, plus you get reported as being more responsible, as a reward your credit score is high.

Do you want to pay more or pay less????? Realize over the course of 30 years vs the time to save up for a large down payment. Putting less towards down payment you will spend $1000's more over the life of the loan. Putting at least 20% as a down payment, you will spent $1000 less over the life of the loan.

Pertaining to your situation because you are coming from another country. Understand you are not automatically going to be able to apply for financing. I just remembered talking to a borrower years ago from the middle east, was able to get financing through Chase because they are an international bank. He already had an account with Chase in his home country.

Coming here you have to first get nationalized and apply for a social security number. Next you are going to need to show two years of work history working. Unless you have family here, you are going to be renting an apartment. Work on building your credit and saving up for your down payment.

As for your question for sites learning more information, one really good site to understand about building credit is the creditinfocenter (Google it).

Good Luck

[SmartMoney]

The problem is Mr. Dodd and Mr. Frank. They passed legislation, of which only a portion has been put into motion. We have new requirements coming at us for the next couple years. Add to that, every single agency (Fannie, Freddie, FHA and VA) change their guidelines at a moment's whim, so quickly that before anything could be put in print, it would be outdated.

Welcome to the world of where we look up every question and no longer trust what we were able to do yesterday, can be done today.

[Modification Specialist]

Originally Posted by SmartMoney

The problem is Mr. Dodd and Mr. Frank. They passed legislation, of which only a portion has been put into motion. We have new requirements coming at us for the next couple years. Add to that, every single agency (Fannie, Freddie, FHA and VA) change their guidelines at a moment's whim, so quickly that before anything could be put in print, it would be outdated.

Welcome to the world of where we look up every question and no longer trust what we were able to do yesterday, can be done today.

Smart Money....right on track bro!!..

The question is why did they repeal the Glass–Steagall act of 1933". Glass–Steagall had kept banks from doing “crazy things.

Point - if something worked why did they take it away.....

..

[Pfhtex]

To justify their seats. Bunch of lawyers doing math. I recall in 2007, during the initial stimulus vote, that a couple of congressmen/women were on cnbc talking about how they abstained from the vote "because you need some kind of finance degree to understand it."

So, yeah.