Frequently Asked Questions
Section 1. Purchase
- How do I go about buying a home?
- How can I benefit by using the MOA website?
- How can I apply for a loan with Mortgage Office of America?
- How long will it take to fill out the online application?
- What information will I have to provide on my loan application?
- How long will it take to get a response?
- Is the online application secure? Will the information I fill out
be available to other companies/vendors?
- What happens after I apply with MOA on this website?
- How much can I borrow?
- What will a lender look at when I apply for a mortgage?
- What does it mean to get pre-approved?
- What if I’ve had credit problems?
- What is the minimum down payment I can make on a home?
- Will I have to pay for Private Mortgage Insurance?
- What closing costs will I have to pay?
- Should I choose a fixed-rate or adjustable-rate loan?
- Should I lock my rate?
- What will my mortgage payments include?
Section 2. Refinance
- What is a cash-out option?
- What costs are involved in refinancing?
- Should I refinance my existing loan?
Section 3. Home Equity Loans
- What is equity?
- What is the difference between a home equity loan and a line of
credit?
- Is the interest on my Home Equity Loan or Line of Credit tax-deductible?
- Why should I take advantage of the equity I have built in my home?
- Is the interest rate fixed or variable?
- Why might a Home Equity Loan or Line of Credit be right for me?
How do I go about buying a home?
ANSWER: First, you need to contact us at 407-998-HOME to make an
appointment. During this initial interview, we might be able to pre-qualify you
for a loan. During the pre-qualifying process, we will discuss your income, debts,
savings, credit, and employment. Based on these factors, we will give you a home
price range.
After you know how much house you qualify for, we can put you in contact with a
Real Estate Agent. The real estate professional will help you find a home in your
price range and specified location.
During the pre-qualification process, we will also discuss any issues you may need
to overcome (such as bad credit) and we will give you advice about how to correct
the problem.
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How can I benefit by using the MOA website?
ANSWER: Our site is for anyone who knows the type of loan they
want and anyone who wants a low cost loan with fast and easy approval. Our process
is fast, easy and totally online.
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How can I apply for a loan with Mortgage Office of America?
ANSWER: We offer our customers three ways to apply: in person at
our Longwood office, by calling 407-998-5555, or on the Web using our convenient
online application.
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How long will it take to fill out the online application?
ANSWER: You should allow at least 20 to 30 minutes to complete
the loan application. If necessary, you may save your information and come back
later to finish.
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What information will I have to provide on my loan application?
ANSWER: You'll be asked for the following information:
Personal
- Employment and salary history for the past two years
- Addresses of your residence for the past two years, as well as landlords (if applicable)
- Your social security number and that of your co-borrowers
Financial
- Your current income - this includes your base salary, and commissions or bonuses,
dividends, etc. (income from alimony, child support, or separate maintenance payment
need not be revealed if you don't want it to be considered as a basis for repaying
the loan)
- Numbers and locations of your bank accounts
- Bank/Investment account numbers, balances, and names of the institutions holding
them
As we continue with the loan process after your online approval, you may need to
supply us with pay stubs from your employer covering the last 30 days prior to completing
the loan application.
If you are self-employed or compensated by commissions, you may need to supply your
federal tax returns for the most recent year you filed and the year preceding that
one (two years total).
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How long will it take to get a response?
ANSWER: Once your application is submitted, we will normally contact
you within 24 hours to confirm and discuss the information on your application.
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Is the online application secure? Will the information I fill out be available to
other companies/vendors?
ANSWER: Yes, the online application is secure. All information
provided to Mortgage Office of America on the application is private information
and will not be shared with any unnecessary parties.
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What happens after I apply with MOA on this website?
ANSWER: You will receive an e-mail within 24 hours of submission
of your application. This e-mail will indicate the status of your application and
the next steps you need to take.
You will also receive application disclosure documents in the U.S. mail within 3
business days of your loan submission.
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How much can I borrow?
ANSWER: Several factors determine how much you can borrow including
the available equity in the home, income, prior credit history and our loan limits.
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What will a lender look at when I apply for a mortgage?
ANSWER: Lenders consider many factors in evaluating your loan application,
but they usually focus on four areas:
- Income and debt. How much money you make and what other bills you have to pay helps
the lender determine whether you can afford to make mortgage payments.
- Assets. The lender needs to make sure you have enough money to cover the costs of
buying a home.
- Credit. Whether you’ve met other financial obligations helps the lender predict
whether you will repay your mortgage.
- Property. The home you want to buy has to be worth enough to act as collateral for
the mortgage.
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What does it mean to get pre-approved?
ANSWER: Getting pre-approved means you receive a loan commitment
from your mortgage company before you have found a home, based on a review of your
credit and finances. Having your credit pre-approved shows sellers that you’re a
qualified buyer and helps you establish a clear price range. The process is the
same as a typical mortgage application, except that your application doesn’t include
property information.
If you’re ready to look for a home, take your first step now and apply for a credit
pre-approval.
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What if I’ve had credit problems?
ANSWER: Your credit history is only one factor in qualifying for
a loan, and having made some late payments doesn’t have to keep you from buying
a home. Someone who has consistently made payments on time in the past may have
more financing options than someone who has not, but that doesn’t mean a mortgage
is off-limits if you’ve had credit problems. In fact, MOA offers a variety of mortgage
options to help people with less-than-perfect credit become homeowners and leave
credit challenges behind.
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What is the minimum down payment I can make on a home?
ANSWER: There is generally no minimum down payment required for
buying a home. Many first-time buyers believe they must be able to put down as much
as 20% of a home’s purchase price in cash. That may have been true in the past,
but many of the mortgage options available to today’s home-buyers require little
or no down payment. With housing prices as high as they are, homeownership would
be impossible for many people if not for these low-down-payment options.
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Will I have to pay for Private Mortgage Insurance?
ANSWER: Private Mortgage Insurance (PMI) provides your lender with
a way to recoup its investment if you are unable to repay your loan. PMI is usually
required when the mortgage amount is higher than 80% of the home’s value. That means
that if you buy a home with a down payment of less than 20%, you will probably have
to pay for PMI. One common way of bypassing PMI without making any down payment
at all is to use an 80/20 program, which combines a first mortgage with home equity
financing.
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What closing costs will I have to pay?
ANSWER: Closing costs vary based on a number of factors — including
the lender, mortgage type, purchase contract, and location — but they usually include
the following:
- Lender fees. We will charge for expenses related to making the loan, including an
appraisal fee, a credit report fee, origination points, and discount points.
- Third party fees. Charges for services not provided by us often include the settlement
fee, title insurance, and attorney’s fees.
- Prepaid items. Certain mortgage costs must be paid to your lender in advance. The
most common of these are pre-paid interest, hazard insurance, and deposits to set
up an escrow account.
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Should I choose a fixed-rate or adjustable-rate loan?
ANSWER: Most mortgage loans have either a fixed interest rate or
an adjustable interest rate. With a fixed-rate mortgage, the interest rate never
changes and your payments remain stable throughout the life of your loan. With an
adjustable-rate mortgage (ARM), the interest rate changes at regular intervals —
usually once every year — based on a formula that uses a market index. For most
ARM options, rate adjustments begin after an initial period — usually between three
months and ten years — during which the rate is fixed.
A fixed rate is usually best if you plan to stay in your home for the long term
and are buying at a time when rates are relatively low. An ARM is usually best if
you plan to move before the rate adjustments begin, or if you are buying when rates
are relatively high.
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Should I lock my rate?
ANSWER: Locking your interest rate means your lender guarantees
the rate on your loan even if market rates change before closing. Most lenders will
allow you to lock your rate for 30 to 60 days, with the option to extend the rate-lock
period for a fee. So how do you know whether to lock your interest rate? It depends
on whether you expect rates to rise or fall before you close on your home. No one
knows for sure which direction rates will go at a given time, so it’s a difficult
to make a reliable prediction. It helps to keep track of announcements from the
Federal Reserve Board, whose monetary policies have an effect on mortgage rates,
and to talk to you financial advisor about what may happen in the near term.
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What will my mortgage payments include?
ANSWER: For most borrowers, each monthly mortgage payment goes
toward the following:
- Principal, which is the total outstanding balance of the loan
- Interest, which is the cost of borrowing money
- Taxes, which are levied on the property by the local government
- Insurance, which protects the owner and the lender from losses caused by fire and
natural hazards
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What is a cash-out option?
ANSWER: If you have enough equity in your property, you can refinance
with a loan amount greater than your current mortgage and keep the difference! You
can use the money for home improvement, debt consolidation, or whatever else you
would like.
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What costs are involved in refinancing?
ANSWER: You may pay an application fee as well as the appropriate
closing costs. You may also choose to pay discount points if you want to buy down
the interest rate.
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Should I refinance my existing loan?
ANSWER: People refinance their existing loans for a number of reasons
including obtaining a lower interest rate, to save on monthly payments and to change
the term of the loan. People also choose to refinance if they want to switch from
an adjustable rate to a fixed rate or to consolidate debt by refinancing for a higher
loan amount and using the difference to pay off other debt.
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What is equity?
ANSWER: Equity is simply the amount of value a homeowner has in
the property. Equity is computed by subtracting the total of the unpaid mortgage
balance and any outstanding liens or other debts against the property from the property's
fair market value. A homeowner's equity increases as he or she pays off the mortgage
or as the property appreciates in value. When a mortgage and all other debts against
the property are paid in full, the homeowner has 100% equity in the property.
Equity exists in conjunction with your Loan-to-Value ratio. Your LTV is a ratio
expressing the value of your property compared to the amount of your loan. You can
determine your LTV by dividing your loan amount by your property's value or selling/purchase
price, whichever is lower.
For example, you buy a $100,000 home with a $20,000 down payment of your own money,
and cover the remaining $80,000 with a mortgage. 80,000 divided by 100,000 gives
you a Loan-to-Value ration of 80% and equity of 20%.
You can take a home equity loan or line of credit based on the amount of equity
in your home. So what you are doing is actually just using money that is already
yours!
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What is the difference between a home equity loan and a line of credit?
ANSWER: 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.
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Is the interest on my Home Equity Loan or Line of Credit tax-deductible?
ANSWER: In many cases, the interest on a Home Equity Line of Credit
or Home Equity Loan may be tax deductible. Consult your tax advisor concerning the
deductibility of interest.
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Why should I take advantage of the equity I have built in my home?
ANSWER: Whether the equity in your home is from paying off your
mortgage or an increase in your property value, it is your money to take advantage
of. Your home is a valuable resource and a home equity loan or line of credit enables
you to access that money, with a low interest rate, and use it for whatever needs
arise.
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Is the interest rate fixed or variable?
ANSWER: Home equity loans may offer a fixed interest rate and the
principal is amortized over the term, while home equity lines of credit feature
a variable rate. Interest rates are based on the amount you borrow and the loan
term.
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Why might a Home Equity Loan or Line of Credit be right for me?
ANSWER:
- You can use a Home Equity Loan or Line of Credit to consolidate your debt. If you
have credit cards and other high-interest debt, you may be able to reduce your monthly
payments with a home equity loan or line of credit.
- You can make home improvements. Adding an extra bedroom, updating your kitchen or
replacing an old roof are all smart ways to increase your home’s value and protect
your investment.
- You can use the funds for a variety of other uses, such as college tuition, vacation
expenses, or large purchases such as furniture, appliances, or even a car.
- You may save at tax time.* The interest on your Home Equity Loan or Line of Credit
may be tax deductible* which can save you money year after year.
*Consult your tax advisor concerning the deductibility of interest.
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