Mortgage Brokers Wichita KS

For the potential homeowner in Wichita who is looking for a mortgage, there are a great many possibilities that cover not only all financial situations but all credit issues as well. First time homebuyers programs exist for the middle-income buyer who has not owned a home in the last three years and doesn't have much money for a down payment. Government-backed mortgages for those who don't have money to put down and qualify under those programs are also plentiful. There are mortgages that are even accessible to those individuals with less than stellar credit: the trick is in locating such opportunities.

Mortgage rates vary contingent upon the type of mortgage, credit of the borrower, amount of the down payment, age of the property, and other varying factors. In addition to interest rate, other items that add to the cost of a mortgage include taxes and insurance and sometimes a lender may require private mortgage insurance (PMI) if the ratio of the mortgage loan to appraised value is higher than the amount the lender allows, usually 80% or less for a conventional, or non-government guaranteed mortgage. Individuals with less than stellar credit may find that mortgages come with a slightly higher interest rate attached to them: the interest rate is congruent with the risks the lender must take in order to supply the consumer with the loan.

Mortgages can also vary in the prepayment term and can sometimes be directly connected to the interest rate. For example, the mortgage company in Wichita may offer a 15-year variable rate mortgage at 6.25% but a 20-year variable rate mortgage at 6.50%. Fixed rate mortgages tend to have a higher rate than variable rate because the lender has an option to raise the rate annually, however, these are very dangerous for those who work in an industry where raises are not guaranteed (companies who frequently have hiring freezes, for example) or those who are on a fixed income because they are based on the premise that your income will rise every year, and in some cases, even if you receive a raise, it will not match the increase in your mortgage payments.

Conventional mortgages are just one type of mortgage available to consumers. This is the most well known mortgage and the type that most lenders in Wichita prefer. With a conventional mortgage, the buyer is required to pay minimum of 20-25% down based upon the appraised price. If the buyer is fortunate enough to find a seller who is willing to take less than the appraised price, that means the buyer does not have to put as much down since the amount the bank will finance is the ratio of loan amount to appraised value and not loan amount to sales price. Of course, that can go in reverse as well if you have a seller who is trying to sell his home for higher than the appraised value and has a buyer who is willing pay more than the home is worth.

Home sellers also prefer conventional mortgages for a number of reasons, the most important one being that there are no points involved. With a government-guaranteed mortgage such as FHA or VA, the banks and mortgage companies charge a fee to compensate for the fact that they must charge a lower interest rate than is customary. The seller customarily pays this fee, but sometimes a buyer and seller agree to share this cost in order for the seller to agree to accept the government financing.

Another reason sellers prefer conventional financing is there is less time from loan application to loan approval. If a buyer has a strong credit and work history, a conventional mortgage loan may be able to close within 30-45 compared to 60-90 days for government loans. If the seller and buyer in Wichita are looking to move soon due to the sale of current residence or termination of a lease, this makes it quite convenient and less costly for both.

VA mortgages are reserved for those who have served in the military or are currently in the military in active or reserve status. What makes it attractive to buyers is that there is no down payment requirement, the interest rate is lower than conventional mortgages, and the seller pays all points. On the other hand, sometimes the fact that the seller has to pay the points discourages some sellers from being willing to accept buyers who plan to apply for a VA guaranteed mortgage.

On the other hand, sellers who limit themselves to only conventional mortgages limit their potential to sell their property in a timely fashion unless they live in a high-priced area where everyone is moving from another home rather than first time homebuyers. In most cases, VA loans are easier to obtain not only because of the fact that there is no down payment but because the income qualifications are lower. In addition, the settlement costs tend to be lower because the points are paid by the seller, leaving the buyer's cash outlay freer to pay for other costs that are associated with the mortgage.

For the veteran who is interested in home ownership, the VA mortgage is the best way to go. In addition, if you run into problems throughout the course of the mortgage, you can depend on the Veteran's Administration to intercede with the mortgage company on your behalf. When it comes to mortgages, if complications should arise, it's certainly nice to have specific agencies working for you toward a promising resolution. Your benefits do not run out, however, you must pay off one mortgage before you can use your benefits again. In the case of a takeover, the buyer will need to apply for his own certificate of eligibility for you to be able to use yours again.

FHA or Federal Housing Administration is another government-guaranteed loan for purchasing a home, but unlike the VA loan, there is mortgage insurance required, and in some cases, there is a minimal down payment of 1-3% depending on credit history. The insurance premium of 1.5% is equivalent to that of a conventional mortgages and can usually be cancelled when the ratio of the loan balance to the appraised value meets with bank policies. This will depend on bank policy, however, and may or may not allow you to drop the insurance.

FHA loans are designed for those who cannot come up with the minimal down payment or who have credit issues. Unlike other types of financing, a Chapter 7 bankruptcy only has to be two years old, and a Chapter 13 one year. For most lenders, the requirement is much stricter, with most requiring at least two years of good credit. It gives the credit challenged potential homeowner a chance to realize his dream of home ownership without having to wait several more years to clear up derogatory items on his credit report. Plus, once the FHA mortgage has been approved, as long as the home owner remains on time with the payments, their credit will improve dramatically.

FHA also does financing under a special program for homeowners who need to do major repairs to their home. This program allows the homeowner to completely rehabilitate their home or purchase a home that is in need of rehabilitation. For many homeowners, the prospect of trying to make major repairs to a home is not within reach, but with this program, either one is possible, which opens up many avenues for homeowners who want to make their homes liveable. After all, one's home is their greatest asset, so keeping it in good repair is certainly an important part of the process. Essentially, FHA mortgages open the doors opportunity to those that may have a great deal of difficulty getting the cash they need for a new home or to make home repairs.

The process of applying for a mortgage is one of the most time consuming and difficult loan processes that exists. The amount of paperwork is probably more than you will ever have to do in your entire life, but in the end, it is well worth it. When it comes to apply for mortgages you will need to carefully fill out all applications in addition to submitting the appropriate paperwork requested. When you go to apply for the loan, you want to make sure you have everything that you are going to need including the following:

• Social security or tax identification number
• Proof of income and employment
• Proof or residence
• Name and address of landlord or current mortgage company
• List of all debts
• Banking information including account numbers
• Copy of the sales contract for the home you are buying

If you have all of the information when you apply for the mortgage, it will take much less time for the processing. The lender cannot complete processing your application without all of the information, so if you have it with you from the start, it will make the process much simpler. Of course, before you even make an appointment with a mortgage company, you may want to make some inquiries and find out what kind of information may be necessary and find out what the interest rate based upon your circumstances. Of course, if you are looking for an FHA or VA loan, the government sets those rates, but you will need to find out which lenders participate in those programs.

When you apply for the loan, be prepared to spend an hour or two with the loan officer. There will be an enormous amount of paperwork involved in applying for a mortgage, so it's not a process that anyone can rush by any means.

Depending on the type of loan you are seeking, the time can be anywhere between two weeks to three months. The average time for a conventional mortgage is usually about thirty days, however an FHA or VA loan can take sixty, or even ninety days, especially if the borrower has less than six months on his job.

Since all information must be provided in writing, if the creditors, employer, or bank does not return the information requested in a timely fashion, the lender cannot make a decision on the application. Even though you may be in urgent need of an answer because your lease is running out on your current residence, or you have a buyer for your house, others are not in such a hurry and sometimes tend to put account and employment verifications to the bottom of the pile. Rather than become angry or upset about it, take the time to contact the people yourself and advise them of the situation, asking them to please understand your urgency and ask them to return the information in a timely fashion.

Once your application is approved, if you have not already done so, you can schedule an appointment with a lawyer for the closing. This process involves all of the paperwork for the transfer of title, distribution of funds, and payment of all fees involved. It is likely to take one and a half to two hours depending on how much paperwork there is, and whether you have any questions about the papers you are signing. The fewer questions that you have at the settlement table, the quicker and smoother the process will go. That doesn't mean you shouldn't ask questions; if you are in doubt about something, ask questions.

After closing, you are free to move into your new home, and if you are like most people, as soon as you leave the settlement table, you want to go back and move. The moving company is waiting for the cue to leave, and all of your boxes are packed and ready. If this is your first home, you are likely ready to move in and settle, especially if you are moving from an apartment. The extra room will be more than welcome, and you will quickly fill up those extra rooms with new furniture and other things that you didn't have room for in your former residence.

The date of your first payment depends upon when you made settlement. Since the law requires that you have the funds for at least thirty days before you have to start paying on it, making settlement anytime after the first of the month gives you a nice reprieve. In other words, if you settle on May 5th, your first payment will not be due until July 1st. Granted, you will pay prepaid interest, taxes, and insurance at settlement, but you will not have to make a mortgage payment until that time.

If you've been in your home a good many years, you have built up a great deal of equity in it. Over the years, you have worked hard, paid your payments on time, and now that you have reached the time in your life when you should be able to enjoy life - namely, your retirement - you find that your retirement income doesn't come close to what you were used to making when you were working. In fact, most times you find you have to struggle just to make ends meet. You worry if you're going to be able to continue to make the payments on the home you have worked so hard to maintain, where you raised your children, and where now your grandchildren come to visit and play in the backyard just as their parents did.

If you are one of those retirees who is having trouble making ends meet on your pension, you're sitting on a goldmine, namely your home. Reverse mortgages were created for people who are in the golden years of their lives and have been in their homes long enough to build equity. What happens is the mortgage company assigns you a credit limit based on the appraised value of your home minus any remaining balance on the mortgage. Instead of having to pay your mortgage each month, the mortgage company applies the payments against your reverse mortgage balance. No funds are disbursed initially but are disbursed as needed. This allows seniors to live comfortably without having to worry about how their bills are going to be paid or having to go into debt taking an equity loan on which they will need to make payments, again on income less than what they had while they were working.

The process of obtaining a mortgage is a long and difficult one, but over time, it is the best investment you will ever make as evidenced by the fact that it can lend additional income during your retirement years without increasing your payments. Even before retirement, your home can be a source of income for many things you want and need, including the college education of your children. As the equity builds up over the years with the increased value in your home and the decrease in your loan balance, your home becomes a source of funds for many things including home improvements, repairs, college, medical expenses, vacations, remodelling, bill consolidation, and much more. When your children are grown and married, and your grandchildren play in the same yard, you will know it was well worth the effort to struggle for those years.

It will be hard in those early years, and the mortgage will not gain much value at first, but as time passes, you will know that you made the right decision when you sat in that loan officer's office for one or two hours filling out all of that paperwork.

Your home is the most expensive thing you will ever buy, and as such, you want to keep it in perfect shape. With equity loans and lines of credit, you will find it easier to make those major repairs that you couldn't do otherwise, and making those payments over the years gives you money you may need to draw on when you retire. By taking care of your home while you have a substantial income, you assure that your home continues to build in value over the years until you need the funds in the form of a reverse mortgage at retirement.