Coldwell Banker Gundaker Home Buyers Guidebook - 2017 | Page 16

FINANCIAL FAQs Financing Your New Home

Answers to these financial questions will help you get a basic understanding of the financing process . Of course , your Coldwell Banker Gundaker Realtor ® can assist you in finding all the information you need to know to make a sound decision on the purchase of a new home .
Q . What is the difference between “ prequalified ” and “ preapproved ”?
A . A prequalification consists of a discussion between a home buyer and a loan officer . The loan officer collects basic information regarding the customer ’ s income , monthly debts , credit history and assets , and then uses this information to calculate an estimated mortgage amount for the home buyer . The prequalification is not a full mortgage approval , but estimates what a home buyer can afford .
A preapproval , on the other hand , is a comprehensive approach using basic information as well as electronic credit reporting . Preapprovals , in most cases , are true mortgage commitments . The lender commits to financing your home and indicates the total mortgage amount available to you .
Q . What types of mortgage programs are offered ?
A . Currently , there are different mortgage products available , including , but not limited to :
• 15 , 20 , and 30-year fixed rate loans
• Adjustable rate loans
• New construction financing
• VA and FHA loans
• 5 and 7-year balloon loans
All mortgage products have their own benefits and disadvantages . Talk to your financial institution to discuss which product is best for you .
Q . How long does it take to process a mortgage application ?
A . Usually about 45 to 60 days , although it can take as few as seven days and as long as 90 days for some transactions .
The actual time depends on how quickly the lender can get an appraisal of the property , a credit report and verification of employment and bank accounts .
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