The key to a successful transaction with no closing cost is in the loan size.  For clients with small loans (those borrowing less than $100k) this option may not be very appealing.

No closing cost options allow you to refinance with no cost or fees. The best part is you can lock in a lower rate now and close without having to worry about closing cost. If rates go even lower, you can refinance again with no cost or fees.  The best part, is you have no “risk” in rates dropping even further as you paid no closing cost.

So what’s the catch?
Depending on your loan size, your rate may be slightly higher than the average market rate.  However, if you are saving money even at the slightly higher rate, it makes complete sense to refinance with no closing cost.  The key to making a no-closing cost loan work is in the loan size.  The larger the loan, the easier it is to get no closing cost and a low rate. 

Will paying closing cost get me a better rate?
Yes, paying closing cost will get you a better rate. However, it may not make sense to pay $1200 to $2000 in closing cost if the difference in rate is small. This is because it may take you longer to make back your cost. In addition, if rates were to drop further, you could be out the investment of closing cost should you elect to refinance a second time. 

How can I lower my cost?
Some clients will opt to “split the difference”.  By paying a portion of their closing cost, clients can reduce the amount of an increase in interest rate to make for a no closing cost option.  Many clients will opt for the reduced closing cost option.   Depending on your loan size, the cost to take advantage of this option may vary.

Do I have to have any money at application if I am doing a No Closing Cost Loan?
An application deposit is collected on all applications whether or not you choose a no or reduced closing cost option. That deposit is refunded to you at the time of closing.

Additional Refinance Information (click here)

Here are the highlights of President Obama’s enhanced HARP program.  Please keep in mind that ALL of the criteria must be met in order to be eligible.

• Only loans that are ultimately owned by Fannie Mae or Freddie Mac are eligible.  Use the following links to determine if your loan is sold to Fannie Mae or Freddie Mac
  Freddie Mac – https://ww3.freddiemac.com/corporate/
  Fannie Mae – http://www.fanniemae.com/loanlookup/

• Your loan has to have been sold to Fannie Mae or Freddie Mac prior to June 1, 2009 to be eligible.  If you closed on your current loan in May of 2009 or after, your loan may not  have made this cut off.

• Just because your loan is owned by Fannie Mae or Freddie Mac does not mean it will be eligible under the HARP program.  Some loans that meet the eligibility dates and are owned by Fannie Mae and Freddie Mac are still not eligible for the HARP program.  Once you have completed a formal application, we will be able to make that determination quickly as to whether or not your loan is eligible.

• If the loan originally had a down payment of less than 20% and PMI insurance, you will be required to retain PMI insurance as part of the new loan unless you can demonstrate that you now have 20% equity based on a current appraisal.

• A current appraisal of your home may be required as part of the approval process.  In some cases, the need for an appraisal is eliminated.  The appraisal requirements will vary from borrower to borrower.  Not all borrowers will be eligible to have an appraisal waived.

• As part of President Obama’s HARP program, homeowners with substantial decreases in value can still take advantage of this program. This is true even if you owe more than what your home is worth.

• There is generally no limit to the percentage of the home that can be financed.  Example, if you owe $200,000 and your home appraises for $100,000 your loan is essentially 200% of the homes current value.  Under the enhanced program you are still eligible.

• Borrowers CAN NOT refinance a second mortgage as part of the first mortgage.  The second mortgage holder must be willing to go back into a second lien position in order for a borrower to refinance.  Most second mortgage lenders cooperate with this program.  It is important to remember that Home Equity Lines of Credit and Home Equity loans are considered second mortgages and require a subordination (going back into second lien position) by the lender.

• Many of the fees for HARP refinances have either been reduced and or eliminated.  However, the terms you are offered can vary depending on the loan term you select as well as what your final appraised value is.

Ready to find out what your options are?  Apply online for a no-cost, no-obligation mortgage application.  We look forward to assisting you.

I have been in Mortgage Banking since 1991 and have been actively involved in construction lending for my entire career.  In addition, I too have custom built a home, so I understand the entire building process from start to finish.  Just like the process of selecting a builder, you want a mortgage banker that is experienced and has all of the tools available to insure you get the right loan at the most favorable terms and options available.

Here are some of the highlights of our construction lending products:

• One Closing – When you close, you close on both your construction loan and permanent long term mortgage at the same time.  This eliminates the need for an additional mortgage upon completion of your home.

• One Set of Cost – Because you only close one time, you have one set of closing cost for both your construction loan and permanent mortgage.  This can save you thousands of dollars compared to other lenders.

• Guaranteed Interest Rate Upfront – Your interest rate is locked in and guaranteed at the time you close your construction loan.  This eliminates the need to worry about what happens to rates during construction.  Best of all, you can lock in today’s low fixed rates!

• Flexible Construction Terms - We offer flexible construction terms that give you anywhere from 8 to 12 months to compete construction of your home depending on the needs of you and your builder.

• Float Down Options – If rates are lower upon completion of your home, we offer the ability to take advantage of lower rates upon completion.  Some restriction do apply, see us for details.

• Payment Reduction Options – Maybe your home comes in under budget.  In cases where you do not borrow the entire construction loan amount available, we will modify your payment to reflect the amount you borrowed in total.  This often times results in a lower monthly payment.

• Builder Approval – We will review your builders credentials, references and overall experience to help insure your builder can successfully complete your project as anticipated.

• Interest Only Payments – Low interest only payments on your construction loan during the course of construction.  Payments are based on the amount the builder has drawn toward completion and collected monthly.

• Low Down Payments – We offer down payment options as low as 5% for well qualified borrowers.  Some restrictions may apply, call us for details.

• NO or Reduced PMI options - If you will have a down payment of less than 20%, we offer options that either eliminate or reduce the cost of mortgage insurance, call us for details.

• Bridge Loans – Well qualified clients who have not sold their current home, may be eligible for a bridge loan which will allow them to start construction on their new home prior to their current home being sold.  This program offers flexible payment schedules.

Want to know more about construction loans and options?  Click here to visit the construction lending portion of our website.

We offer a no-cost pre-approval.  With our pre-approval, we will help you determine monthly payments, down payment requirements and which loan option may work best for you.  Click here to start our online application free of charge or obligation.

Need a referral to a well qualified builder?  We work with some of the best in West Michigan contact us and we will be happy to get you connected with a well qualified builder

Refinancing Common Questions – FAQ
I get a lot of questions about refinancing and when is it worth it.  You can find answers to common questions about refinancing by clicking here.

Be Patient
In order to provide you with the high level of customized advice you have come to expect from my mortgage practice, i take great care to make sure I cover all of the details for each client without trying to have them feel I am rushing them through the process.

Help Us Help You
Maybe your not sure if you should refinance.  Having answers to the following questions will help me to help you determine the benefits to refinancing.  Not having this information doesn’t mean I can’t help you, but does makes it more difficult for me to help you determine if refinancing is a benefit to you.  Here is what is helpful for you to know when you contact me:

• When did you purchase your home and how much did you pay for it?
• What was your original loan amount, type (Conventional/FHA/VA/Other) and interest rate?
• Do you have a second mortgage or any type of mortgage insurance (PMI)?
• What is your current mortgage balance and who is the loan with?
• Have all of your mortgage payments been made on time?
• If you were going to sell your home today, what is your best estimate of your homes value?

Knowing this information is key to helping me help you determine what your mortgage options look like and whether or not refinancing makes sense for you.

The Next Steps
Once we determine refinancing is a benefit to you, here are the steps you need to take to proceed forward as well as the information I will need from you:

• Complete a current mortgage application (Click Here To Apply Online)
• Copies of your last two paystubs for all applicants
• Copies of your prior years W-2 form for all applicants
• Copies of your most recent bank statement (all pages, front and back, including blank pages).
• Copy of your current homeowners insurance policy

Locking In
Locking in an interest rate is just that, locking it in.  By locking in an interest rate that is the rate you are guaranteed whether rates go higher or lower.  Once you have locked, your rate will not increase nor will it decrease.  There are no guarantees on interest rates until such time you lock in.

Your interest rate is NOT locked in until I have confirmed so in writing.  Sending an email or leaving a voicemail does NOT secure your interest rate.   I am not able to lock in your interest rate until such time you have paid your application deposit.  If you have not supplied us with your supporting documents (The Next Steps) within 3 business days from locking in, the bank reserves the right to cancel your rate lock or charge you the higher of the rate you locked in or current market rates.

It All Comes Down To The Appraisal
In most cases, the largest hurdle to clear in refinancing is the appraisal of your home.  Depending on your current loan type, what your home needs to appraise for can vary and will ultimately determine your ability to refinance.  The cost of an appraisal for most properties is approximately $350.00 (can vary depending on property type).  Prior to ordering the appraisal we will discuss in detail with you your options and where your home would need to appraise before proceeding.

I hope this information is helpful as you review your options for refinancing.  Please keep in mind that being prepared will help to expedite the loan process for you.

Don’t hesitate to contact me with any questions or concerns you may have.

Things That Can Change Your Rate
So what factors go into determining your rate?  Here is just an abbreviated list:

• Credit Score
• Equity – Down Payment
• Property Type
• Loan Type (Construction – Purchase – Refinance – Rehabilitation)
• Loan Term
• Number of Units
• Occupancy
• Debt Ratios
• Closing Cost
• Escrow Accounts
• Second Mortgages
• Mortgage Insurance
• Other Criteria

I have to be honest, that is a very short list of the many factors that can have an impact on your final mortgage rate. It is important to remember that each characteristic can and will have an impact on your cost of mortgage money.  We will provide you with a detailed and accurate set of figures with all of your options explained in depth to insure the mortgage you select is the best one for you, not the best one for the bank.

Thanks again for giving The Dan Moralez Mortgage Group the opportunity to serve you!

My mortgage practice has always been built on finding individualized solutions for clients.  Unlike the big impersonal banks, we treat you as more than a number and take the time to get to know you, your financial goals and how a mortgage will impact those goals.  In addition, we realize that a home is one of the largest purchases you will ever make in your lifetime.  Because this is such an important purchase, we take seriously our responsibility to help you navigate the sea of mortgage choices.  I like to tell clients “A great rate on the wrong mortgage is still a bad deal”.  That statement is more true now then ever.

If you want expert mortgage advice from a seasoned mortgage professional, make sure you give me a call.  I look forward to working with you on your new home mortgage.  I can be reached at 616-931-4629.