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Need answers to your mortgage questions. Here are some facts about the mortgage process.

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Who is considered a “first-time homebuyer”?The IRS considers a first-time buyer to be someone who has either:
1) never purchased a home, or
2) someone who has not owned a home in the past three years.


I’m a first-time homebuyer purchasing a home. What programs will work best for me?Most people think of FHA when it comes to first-time homebuyer programs and this is certainly a good option, but it’s not your only option. When purchasing a home, there are many things to take into consideration such as income, debt-to-income ratios, credit score, assets and down payment. FHA allows for a low down payment option and generally speaking is more lenient when it comes to credit. If you have more to put down and have good credit, there may be options for a Conventional loan with Mortgage Insurance (monthly MI, single premium MI, or lender paid MI.) Please speak with your loan officer as they will know your situation best and will tailor your needs to the best possible loan program for you.


Are there any down-payment assistance or other assistance programs available for first-time homebuyers?State Bond programs and the NHF Platinum Program™ are designed to provide down payment assistance in conjunction with a primary residence home purchase.

The Portland Housing Bureau partners with local lenders, such as Summit Mortgage, to offer first-time homebuyers a federal tax credit called a Mortgage Credit Certificate (MCC) which in return reduces the homebuyer’s federal income taxes owed. The homebuyer must keep the home as their primary residence, have a tax liability and utilize the MCC when they file their taxes. The property must be located in the City of Portland and there are income restrictions.

Please be sure to inquire more with your loan officer for details for any of these programs.


I have moderate to low income and I’m interested in purchasing a home in a rural area. Are there any programs available?Yes. USDA has a loan program that will allow for up to 100% financing in certain designated rural areas of the United States (some of these areas might be closer to the city than you think!) USDA also has income restrictions for this program which helps people who have lower median incomes get into homes. Restrictions will apply. The USDA site is a good place to start to find geographical locations (http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do), but please make sure you review your options with your loan officer so they can fully educate you on the USDA qualifying process.


I need a loan for over $417,000 (the conforming loan limit). Does Summit Mortgage offer Jumbo loan programs?Absolutely! We offer financing on loan amounts up to $2.5M on primary residences, second homes and investment properties. Please make sure to discuss maximum loan-to-values and asset reserve requirements with your loan officer.


I’d like to purchase an investment property. Do I need to have prior history as a landlord in order to qualify?There are many things to consider when qualifying to purchase a rental home. Debt-to-income ratios, down payment, credit scores and asset reserves are many of the things to consider, but you do not need to have previous history as a landlord to qualify.


If I already own four financed investment properties, can I purchase and finance more?Yes. We will allow up to 10 financed properties and in certain situations more.


I’m a veteran. Can Summit Mortgage help me with my mortgage loan?Yes and we also offer financing to those who are on active military duty. Summit Mortgage offers VA financing up to 100% loan-to-value on owner occupied properties on both purchase and refinance transaction. We also offer the ODVA’s OR VET loan program (only offered in Oregon.)


Should I refinance?The most common reason to refinance is to save money. This can be done by either obtaining a lower interest rate, or by reducing the term of the loan. Obtaining a lower interest rate will reduce the monthly payment made each month. Reducing the term of the loan, for example from a 30 year loan to a 15 year loan, may increase the monthly payment, but the total interest paid during the life of the loan may be significantly reduced.

Another common reason to refinance is to convert an adjustable loan into a fixed loan. This provides stability and security in the interest rate and monthly payments for the entire life of the loan.

A third reason to refinance is to obtain cash-out from the home’s equity. The cash out can be used for a myriad of things such as remodeling your home to consolidating debt. Consolidating debt such as a line of credit, credit cards, student loans, auto loans, etc. can result in a tax savings since most mortgage loans are tax deductible.


I want to finance a manufactured home. Am I able to do so?Yes. Summit Mortgage is able to finance manufactured homes.


What’s the difference between a fixed rate mortgage and an adjustable rate mortgage (ARM)?On a fixed rate mortgage the interest rate never changes and your payments remain the same throughout the life of the loan. With an adjustable rate mortgage, adjustments to the rate are periodically made throughout the life of the loan. Typical ARMs include 3/1, 5/1, 7/1 and 10/1 ARMs. Depending on the type of ARM program, rate adjustments may begin after 36-months, 60-months, 84-months or 120-months of closing the loan increasing your monthly mortgage payment (i.e. a 5/1 ARM will adjust after 60-months). If you are planning on staying in your home for a longer term usually a fixed rate is the best way to go especially when rates are relatively low. An ARM is best if you plan on moving out of the home before the rate adjustment begins, or if you are buying at a time when rates are relatively high.


What is the difference between a home equity loan and a home equity line of credit?An equity loan allows you to borrow a set amount of money at a fixed interest rate. If you need a large amount of cash, then this is a good option for you. The rate of interest is fixed so you always know what your monthly payments will be and you can use the money for a number of things including home improvements, debt consolidation or other major expenses.

An equity line of credit allows you to reserve a line of money that you can use only if you need it. You can borrow from that line at any time in the future so you have the security that if you need the money, you can access it. You will make no monthly payments until you actually draw on the money which means you don’t have to draw any funds and it can sit at a zero balance. An equity line enables you to be ready in case extra expenses arise such as medical bills, emergency home repairs, and college tuition. The interest rate on an equity line of credit is not fixed; it varies based on the prime rate.


I’m relocating to the area and would like to buy a house, but I won’t start my job until after my loan would close. Are there any loan programs out there that could help me?Yes. Summit Mortgage has a “Future Income” loan that enables you to purchase a primary residence before you receive your first paycheck. Please make sure to discuss further details with your loan officer.


How long will it take to close a mortgage loan?On average it takes 30-days to close a mortgage loan. This of course may vary depending on the type of loan and the scenario behind the loan. For example a construction loan can take about 45-days to close where as a Conventional or FHA loan could close in as little as two-weeks depending on the scenario.


Can I apply for a loan if I am self employed?Yes. Most loan programs are open to self-employed borrowers. Typically speaking, you’ll need to show and prove that you’ve been self-employed for at least two-years.


What happens if my loan is sold to a different lender?If your loan is sold to a different lender both the new lender and the old lender are obligated to inform you of the changes being made, usually via mail. The lender purchasing your loan is to assume all terms and conditions of the original loan. The only way this affects you is to whom you mail your payment to. The new lender should inform of you of where to mail your payments to within a reasonable time frame. In the event that you do not receive such information by the time your next loan payment is due continue making payments to your old lender until further notice.


What is a “rate lock” and when can I lock my rate in?A rate lock is a contractual agreement between the lender and buyer. There are five components to a rate lock: 1) loan program/term, 2) interest rate, 3) the length of the lock/expiration date, 4) origination fee and lender credit (if applies), and 5) the property address.

You must have a property address tied to locking in your interest rate. For instance, if you’re still in the process of shopping for a home and don’t have an accepted offer on a property yet, you must wait until you are in contract in order to lock your interest rate.


What’s the best loan program for me?That depends on a number of factors, including:
– How long you’ll stay in the home?
– How much money you’ll put down?
– How you’ll finance the closing costs?


What kind of property can be financed? – Primary Residence
– New Construction
– Second Home
– Investment Property
– Condominium/Duplex
– Manufactured Home
– Town Home


What is a rate lock?A rate lock is a contractual agreement between the lender and buyer. There are four components to a rate lock: loan program, interest rate, points and the length of the lock.


How long will it take to close a mortgage loan?On average it takes 30-days to close a mortgage loan. This of course may vary depending on the type of loan and the scenario behind the loan. For example a construction loan or a FHA loan can take about 45-days to close where as a conventional loan could close in 2 weeks depending on the scenario.


Can I qualify for a loan if I am self employed?Yes. There are programs available for self employed borrowers.


What happens if my loan is sold to a different lender?If your loan is sold to a different lender both the new lender and the old lender are obligated to inform you of the changes being made, usually via mail. The lender purchasing your loan is to assume all terms and conditions of the original loan. The only way this affects you is to whom you mail your payment to. The new lender should inform of you of where to mail your payments to within a reasonable time frame. In the event that you do not receive such information by the time your next loan payment is due continue making payments to your old lender until further notice.


What is Equity?Equity is a homeowner’s financial interest in a property. It is the difference between the fair market value of the property and all amounts owed on the property. On a new mortgage purchase loan, the down payment represents the initial equity in the property.


What is the difference between a home equity loan and a line of credit?An equity loan allows you to borrow a set amount of money at a fixed interest rate. If you need a large amount of cash, then this is a good option for you. The rate of interest is fixed so you always know what your monthly payments will be and you can use the money for a number of things including home improvements, debt consolidation or other major expenses.

An equity line of credit allows you to reserve a line of money that you can use only if you need it. You can borrow from that line at any time in the future so you have the security that if you need the money, you can access it. You will make no monthly payments until you actually draw on the money. An equity line enables you to be ready in case extra expenses arise such as medical bills, emergency home repairs, and college tuition. The interest rate on an equity line of credit is not fixed; it varies based on the prime rate.


Do I want a fixed or adjustable rate mortgage?On a fixed rate mortgage the interest rate never changes and your payments remain the same throughout the life of the loan. With an adjustable-rate mortgage adjustments to the rate are periodically made throughout the life of the loan. Depending on the type of ARM program rate adjustments may begin after 3 months of closing the loan increasing your monthly mortgage payment. If you are planning on staying in your home for a long term usually a fixed rate is the best way to go especially when rates are relatively low. An ARM is best if you plan on moving out of the home before the rate adjustment begins or if you are buying at a time when rates are relatively high.


What’s the value of your home?Many homeowners are curious about the value of their home. As you may be aware, home values are constantly fluctuating. Simply fill out the information below to calculate an estimate of how much your home is worth now. This application uses a Conventional Mortgage Home Price Index (CMHPI) to estimate the value of your home considering the appreciation rate for your region. While the estimate may not be the actual or appraised value of your property, it can be a useful tool to gauge fluctuations and trends in your market which affect your home’s value.