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Frequently Asked Questions

Frequently

Asked Questions

What is the difference between pre-approved and pre-qualified?

When a homebuyer is pre-qualified, he or she has provided the lender with the basic information to determine which loan program the homebuyer may qualify for. Whereas, when a homebuyer is pre-approved, the lender has collected, verified and presented the information needed for underwriting and approval.

What is the difference between interest rate and APR?

Your interest rate is the monthly cost you pay on the unpaid balance of your home loan. An Annual Percentage Rate (APR) includes both your interest rate and any additional cost or prepaid finance charges such as the origination fee, points, private mortgage insurance, underwriting and processing fees (your actual fees may not include all of these items). While your interest rate is the rate at which you will make your monthly mortgage payments, the APR is a universal measurement that can assist you in comparing the cost of mortgage loans offered by different mortgage lenders.

What are the closing costs?

Closing costs include items like appraisal fees, title insurance fees, attorney fees, pre-paid interest and documentation fees. These items are usually different for each customer due to differences in the type of mortgage, the property location and other factors. You will receive a good faith estimate of your closing costs in advance of your closing date for your review.

Which amounts are included in my monthly payments?

If you have a fully amortizing mortgage, portions of your monthly mortgage payment go toward loan principal and interest. Interest-only mortgage payments include only the interest that is due on the outstanding principal balance. If your mortgage carries mortgage insurance, a portion of your monthly mortgage payment will pay this also, unless the lender has paid your mortgage insurance or you have paid your mortgage insurance upfront. If you have set up an escrow account for your mortgage, then portions also go toward your property taxes and homeowners insurance.

What is PMI?

Private Mortgage Insurance is provided by a private mortgage insurance company to protect lenders against loss if a borrower defaults. Private Mortgage Insurance is generally required for a loan with an initial loan to value (LTV) percentage in excess of 80%. In most cases, this will mean that you will have to pay Private Mortgage Insurance if your down payment is less than 20% of the value of the home you are purchasing or refinancing. The cost of the mortgage insurance is typically added to the monthly mortgage payment.

Can I lock my interest rate when purchasing a home?

Absolutely. PRMI provides a variety of options to lock in your interest rate. Locking your rate means that the lender is agreeing to provide you with your mortgage at that particular rate, and that it won’t go up (or down) between the time you lock it and the time that you close on your home. If your mortgage is fixed-rate, your interest rate will remain the same throughout the life of the loan. Mortgage interest rates fluctuate constantly, and you don’t want to start shopping for a house operating under a certain interest rate assumption, only to be unpleasantly surprised that interest rates have risen during your house hunt.

What will my rate be?

Rates are based on a variety of factors such as the loan purpose, your credit history and ability to repay, the value of the collateral and the loan amount.

How do I start the application process for a mortgage?

Visit one of our locations or access our or click here if you are ready to apply.

What is an FHA mortgage?

FHA loans are government-insured loans through the U.S. Department of Housing and Urban Development, also called HUD. FHA loans offer an excellent start to first-time home buyers, with options such as a low down payment or a low closing cost option.

Mortgage Process

Primary Residential Mortgage will make your mortgage lending experience as easy and smooth as possible. Our mortgage professionals are here at every step to answer your questions and guide you.

What are your goals?

We want to know what you are trying to achieve financially and through homeownership. You will discuss these points with your loan officer, and we’ll collaborate to find the mortgage that best fits your needs. We offer many programs that provide funding so you can purchase a home or refinance an existing mortgage.

Obtain basic documentation

After you’ve discussed all the options, your loan officer will let you know exactly what documentation is needed to proceed. These are records such as paystubs, tax returns and your credit report. Your loan officer also will provide some documents that you will need to complete and sign.

Appraise the home and more documentation

If an appraisal is necessary, we will order one from a state-certified appraiser. We will use the assessment of your property to help underwrite your file. Your loan is then sent to our Processing Department where we will gather additional documentation from third parties, such as your insurance agent and employer, to verify your information in the loan file. Once verified, the processor will send your file to one of our underwriters who will ensure your file is complete and add any documents or verify information, as necessary.

Set up a closing

After the underwriter approves the loan, we will schedule a closing during which you will sign all final paperwork to complete the loan transaction. The closing will be scheduled at a time and place convenient for you.

Many other lenders use different loan processes. Primary Residential Mortgage has decades of experience that have helped us refine our process to ensure an excellent and smooth experience. Thank you for choosing us for your mortgage needs. We are eager to help you every step of the way.

2017 Primary Residential Mortgage, Inc.
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