Mortgage Frequently Asked Questions

All the mortgage questions you've ever wanted the answers to, but have been afraid to ask.

What is APR?

The APR is your annual percentage rate, how much you will have to pay per year in order to take out your mortgage.

Should I Get an ARM or an FRM?

That is totally up to you. If you feel that the current mortgage index is low and will remain low then you can save a good amount of money by getting an adjustable rate mortgage. If you enjoy the security of having one interest rate and never have to worry about it increasing, then a fixed rate mortgage is for you.

What are Discount Points?

One discount point is equal to one percentage point of the loan. If you get 2 discount points on a mortgage of $100,000 then that is $2,000. The more discount points you pay for the lower your interest rate will be. Think of discount points as prepaid interest.

How Will My Credit Score Affect My Mortgage?

The lower your credit score the greatest risk you will be seen as to default on your mortgage. If you have a credit score below 600, you are most likely not going to get approved for a mortgage loan.

What is PITI?

PITI stands for everything that is included in your monthly payment. Principal, interest, taxes and insurance.

How Much of a Down Payment Should I Make?

As much as you can afford. Usually, the minimum down payment is 20% of the purchase price of your home. The higher your down payment the lower your monthly payment will be.