Mortgage 101

Since there are so many components to the mortgage process, we have taken special care to organize the most important qualifying steps, lending frequently asked questions, home buying and mortgage processes below.


We realize that the information contained in this site could literally take you weeks to research and digest, so please feel free to call us at any time for a personal consu

1. Mortgage Basics

What is a mortgage, and who owns my home if I have secured financing to purchase it?


Whether you’re new to the home buying process, or a seasoned investor, I bet you didn’t realize that there are at least 20 top mortgage related terms that you may want to understand prior to speaking with a real estate agent or loan officer.


This section highlights some of the basic math and topics of interest that will help you get started on your home buying and financing journey.

2. Mortgage Approval Process

Required down payment, income / employment information and credit standing are a few of the important factors lenders look at when considering a borrower for a mortgage loan approval.


There are several questions that a loan officer needs to ask before a simple pre-approval letter can be issued. But more importantly, there are at least 8 top questions that you should be asking your lender before taking any steps to fill out an application.


Being prepared with the proper documents and personal in formation will allow you to spend more quality time with your loan officer addressing the important points of your pre-approval and mortgage program options.

3. Understanding Your Credit

Your credit picture plays a key role in the mortgage approval process, and it is essential to understand how scores are measured and calculated.


Should you close all cards or keep them open? What if you don’t have any credit history that shows up on a report, is there a way to use cell phone and utility bills?


In this section, you’ll learn the basic rules about preparing your credit standing prior to speaking with a lender for qualification.

4. Mortgage Payments

In addition to mortgage rates, there are many other obligations that factor into your overall mortgage payment.


HOA Dues, Hazard Insurance, Home Warranties, Property Taxes…. to name a few.


It helps to be aware of the expenses involved in owning real estate in order to set a monthly budget that is true to your financial goals and expectations.

5. Mortgage Interest Rates

Mortgage rates can fluctuate several times a day, and are influenced by many factors that are out of the loan officer’s control.


Determining if you’re getting the best deal at any given moment boils down to whether or not you trust that your preferred loan officer is truly looking out for your best interests.


Fortunately, there are economic indicators that impact the typical movement of interest rate markets which you can be aware of on a daily basis. When the media reports that the Fed is moving rates down, it always seems that home loan rates go up. What about the points vs no points, and APR?

6. Mortgage Programs

It’s amazing how many mortgage programs have been designed to help First-Time Borrowers get financing on new homes.


Before you start shopping for a listing that fits your living needs, it would be extremely beneficial to know what type of lending scenario best fits the type of property or neighborhood you’re looking to buy in.


With regards to a refinance, you may actually qualify for a new government sponsored program that has been designed with current market conditions in mind.

7. Home Buying Process

What comes first – the approval or the purchase contract?


Once you have weighed the basic pros and cons of owning a home vs renting, tax benefits and timely market influences, assembling a winning team of real estate and mortgage professionals will help you cover all of your bases.


There are also some very important timelines that you’ll need to be aware of, such as appraisal, home inspection and loan approval dates.


Can the type of HomeOwners Association affect your loan approval? Absolutely.


If you’re feeling a little anxious at this point, then that just means you’re actually taking this home buying thing seriously.


Don’t worry, we’ll make sure you are kept in the loop throughout the entire home buying process.

8. Closing Process

With the right home buying team on your side, the closing process should be a smooth transition from signed documents to closing.


The excitement has been building throughout the entire process from home shopping to mortgage approval; so it’s easy to over look some important details at the end.


Understanding the industry lingo will certainly help you avoid feeling like you’re on a roller-coaster while all the team players come together at the end to perform doc signings, pre-closing conditions.


It also helps to know about all of the fees associated with a new home purchase or refinance. Understanding the difference between the fixed and variable fees will help you set a more accurate budget, which could impact whether or not you get your earnest money back at closing.

9. Refinance Process

Properly estimating neighborhood property values and your closing costs will help determine the net benefit of a refinance transaction.


Some homeowners just want to know the best approach of finding money to make home improvements, while other borrowers are in a situation where their rate is adjusting.


Either way, it’s easy to get caught off guard if you don’t have the essential knowledge about your mortgage refinance options.

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Texas Mortgage Banker Disclosure – Figure: 7 TAC 81.200(c) “CONSUMERS WISHING TO FILE A COMPLAINT AGAINST A MORTGAGE BANKER OR A LICENSED MORTGAGE BANKER RESIDENTIAL MORTGAGE LOAN ORIGINATOR SHOULD COMPLETE AND SEND A COMPLAINT FORM TO THE TEXAS DEPARTMENT OF SAVINGS AND MORTGAGE LENDING, 2601 NORTH LAMAR, SUITE 201, AUSTIN, TEXAS 78705. COMPLAINT FORMS AND INSTRUCTIONS MAY BE OBTAINED FROM THE DEPARTMENT’S WEBSITE AT WWW.SML.TEXAS.GOV. A TOLL-FREE CONSUMER HOTLINE IS AVAILABLE AT 1-877-276-5550. THE DEPARTMENT MAINTAINS A RECOVERY FUND TO MAKE PAYMENTS OF CERTAIN ACTUAL OUT OF POCKET DAMAGES SUSTAINED BY BORROWERS CAUSED BY ACTS OF LICENSED MORTGAGE BANKER RESIDENTIAL MORTGAGE LOAN ORIGINATORS. A WRITTEN APPLICATION FOR REIMBURSEMENT FROM THE RECOVERY FUND MUST BE FILED WITH AND INVESTIGATED BY THE DEPARTMENT PRIOR TO THE PAYMENT OF A CLAIM. FOR MORE INFORMATION ABOUT THE RECOVERY FUND, PLEASE CONSULT THE DEPARTMENT’S WEBSITE AT WWW.SML.TEXAS.GOV.”


205 ILCS 635/2-9 Posting of license

The license of a licensee whose home office is within the State of Illinois or of an out-of-state licensee shall be conspicuously posted in every office of the licensee located in Illinois. Out-of-state licensees without an Illinois office shall produce the license upon request. Licensees originating loans on the Internet shall post on their Internet website their license number and the address and telephone number of the Commissioner. The license shall state the full name and address of the licensee. The license shall not be transferable or assignable. A separate certificate shall be issued for posting in each full-service Illinois office. Licensee shall post on their internet web site the address and telephone number of the IDFPR. James R. Thompson Center

IDFPR-Residential Mortgage Banking

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Chicago, Illinois, 60601

Tel: (844) 768-1713