Total Mortgage FAQs

The term contingent in real estate means much the same as it does in the dictionary — “dependent on or conditioned by something else.” If a property is contingent, the deal is not cut and dry, even if things are headed in the right direction. Instead, a certain condition must be met first before the offer can blossom into a deal.

For example, let’s say that the buyer and seller have agreed on a price, with the added caveat that the buyer must first sell their own home to complete the deal. This way, the buyer won’t be stuck with two mortgages at the same time. It introduces a bit of ambiguity to the process, but if the real estate professional adds the condition to the offer, and everyone agrees, the deal is contingent on these terms being met.

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A bridge loan offers a “bridge” in the form of cash flow to the buyer so that they don’t hit a snag when buying and selling at the same time. This loan is meant to be short-term in nature, likely between six months and a year, and it is basically collateralized by the buyer’s current property. Given the short-term nature of a bridge loan, the interest rate tends to be higher than usual.

When it comes time to buy a home, there are numerous different mortgage options from which to choose. If you are not only buying a new property but also selling your current home, you’ll want to start out by exploring what a bridge loan is. A bridge loan is designed to help buyers purchase the home of their dreams even before they can unload their current property.

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford. 

Title insurance is used to protect the parties involved in a real estate deal, including the lender, from any issues associated with the property that could hinder a sale.

If any issues are associated with the property that could hinder a sale, such as a lien, the title insurance is in place to protect the relevant parties until the title belongs to the homeowner free and clear. When taking out a mortgage, the borrower will find that the lender requires them to have title insurance to reduce the chance of any unwanted surprises down the road. Title insurance is purchased in a single transaction, and it is meant to last for the duration of the mortgage.

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford. 

An underwriter is basically responsible for deciding whether you will get a green or red light on your mortgage application. If you ask your real estate agent, ‘What is an underwriter?’, they will probably tell you that the underwriter is a financial wiz, and they are not wrong.

Underwriters are vital in the process of securing the homebuyer a loan, and they typically work for the lender. Their job is to analyze a borrower’s financial health in relation to the size of the mortgage to assess the risk of granting the homebuyer a mortgage. More specifically, they will dive into your credit report and could pursue an appraisal of the home’s value. They will check your income and examine your debt in relation to how much you are putting down and your level of debt. 

The underwriting process could involve some back and forth between the lender and the borrower, so be willing to provide any documentation that is requested along the way as it can help your cause. 

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.

While you might be looking forward to signing on the dotted line for your new home as soon as possible, you might want to ask yourself some questions first, such as, ‘What are closing costs?’ These are basically the fees and services that must be paid at the closing, most of which will be the buyer’s responsibility and will be paid to the lender. 

Closing costs are other expenses that get tacked on during the home buying process that are not paid on the spot and might include the home appraisal, title searches, and more. In general, you can expect your closing costs to amount to anywhere from 3-6% of the home price (other estimates range from 2-5%). 

Since most of the closing costs go to the lender, the buyer might be able to negotiate the closing costs into the mortgage, but then the monthly payment will be higher. Buyer and seller commissions to the real estate agents are also paid at the closing. 

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.    

Escrow is a term you’ll want to become familiar with because it will come to play several times during the home buying process. Real estate involves large sums of money, and escrow is part of the checks and balances to keep everybody honest. Basically, the escrow account is a place where a neutral third party holds funds until certain parameters are met.

You might be expected to put down a good faith deposit when buying a home, and the funds must go somewhere. That’s where the escrow account comes into play. If all goes well with the deal, those funds can be directed toward the buyer’s down payment. However, if the deal goes south at no fault of the seller, the funds will generally go to the seller for their trouble. The escrow account is there to protect both sides of the real estate deal until the closing. The lender could also use the escrow account to earmark a portion of the buyer’s mortgage payments for taxes and insurance.

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.

When it comes to real estate, pending could be a positive or negative sign, depending on the eye of the beholder. For those of you wondering, “What does pending mean in real estate,” it basically means that the seller has accepted an offer from a buyer. They have agreed on a price and any potential contingencies and are working towards handing over the keys, so to speak. 

If you are interested in a home only to discover that a sale is pending, you might be tempted to throw in the towel. Keep in mind, however, that a pending house is not a sold house. Should something go awry, the owners of the house could take offers once again. 

So, what could go wrong? Consider a deal that has contingencies. For example, maybe the buyer needs to sell their own home before getting a mortgage to purchase the new property. If those requirements go unfulfilled, your dream home could find itself back on the market. In the interim, you might be able to secure a showing of the house if the seller agrees. Otherwise, it might be best to sit tight on this one to learn if the pending status eventually turns into sold. 

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.

A warranty deed is a legal agreement between the buyer and seller pertaining to the title or ownership of the property. By having a warranty deed in place, you ensure that the seller is the rightful owner of the property that is being handed to the buyer. The warranty deed is designed to give the buyer peace of mind that a third party won’t step in and challenge the deal. 

The seller can take comfort in the fact that the warranty deed prevents any prior discrepancies tied to the property from rearing their head. A general warranty deed covers the history of the property while a specialty warranty deed is more limited in scope. 

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.

When it comes to real estate, your word isn’t necessarily your bond. Earnest money involves putting money down toward the purchase of a new home before you get to the closing. It’s a form of good faith used to give the seller confidence that you have every intention of sticking with the deal for the long haul and they won’t be stuck holding the bag.

The seller is taking on risk when they accept the offer. If the deal falls through for some reason, they must start the process all over again to put their home on the market, which costs time and money. If all goes well, earnest money, which generally amounts to 1-3% of the price of the property, will be directed toward the down payment or the many closing costs. If the deal fails due to an issue on the part of the seller, such as a home inspection not passing muster, for instance, the funds will be returned to the buyer. 

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.

When you find the home of your dreams or even just the one for the next five or 10 years, you’ll want an answer to the question, ‘What is an easement?’ Otherwise, this question could come back to haunt you down the road. 

An easement is an ownership right attached to the title that could entitle someone else access to part of the property. When you buy a home, if there is an existing easement, chances are it will come with the property whether you like it or not.

There are a few different types of easements, including: 

• Utility easements — gives the utility company the right to your property if there is a pole on your land they need access to or a tree that is creating a hazard for a power line, for instance. Think eminent domain. 

• Private easements — a previous homeowner may have sold a private easement to a neighbor for access to solar power that affects where you are permitted to make changes to the property. A similar easement could be in place for sewer access too. 

• Easements by necessity — this might be in place if another homeowner otherwise has no access to a public road or waterway and must pass across your property to come and go.  

• Prescriptive easements — these occur when somebody else uses the property over an extended period as a point of access to their own home, including a driveway or a pathway, for example.

While easements are rare, they do happen and are worth putting on your checklist when buying a home.

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford. 

If you are in the market for a new home, one question you might have is, “What are HOA fees?” HOA (Homeowners Association) fees are monthly payments that homeowners make to the association to maintain the property or community in which they live.

HOAs are typically found within communities comprised of townhomes or condominiums (but it could also extend to single-family houses). HOA fees are typically in place to keep the community looking uniform without any own homeowner making dramatic changes to the home that would set it apart, such as painting it hot pink, for example.The precise services they cover depends on the area where you are moving, but these might include: 

• Lawn care/landscaping around the community

• Snow removal 

• Pool upkeep 

• Golf course upkeep 

• Repairs

• Pest control

• Other amenities (fitness center, etc.)

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.

A deed of trust is essentially an agreement between the lender and borrower stating that a third party will hold the title of the property until the mortgage loan has been repaid by the borrower.

Once you can lock in a mortgage with a lender, the rubber meets the road. At this point, the lender will either secure the funds with a mortgage or a deed of trust. Both documents serve a similar purpose: they entitle the lender to the property in the unfortunate event of a default. Nevertheless, there are key differences. 

With a mortgage, there are two parties at play — the lender and the borrower. With a deed of trust, there is a third participant, a trustee who will oversee the document until the last loan payment is made. This third party, which might be an escrow firm, is responsible for foreclosing if it comes to that. If there is a default, the lender won’t have to go through the hoops of the court system to cash in with a deed of trust. 

You might find smaller or alternative lenders more likely to use a deed of trust, given their nimble nature. 

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.

Title insurance ensures that a lender is not sandbagged and has rights to the property before anybody else if a lien is uncovered. It will stay in force until the mortgage is fully paid. This type of title insurance is required when taking out a mortgage. A homeowner’s title insurance policy is not vital but if you spring for it, the policy is typically worth the same amount as the home price. 

Though the homebuyer foots the bill for title insurance, it could either cover the lender or the buyer, depending on the policy type. Either type is there as a layer of protection in case an outside party emerges laying claim to the property. 

For example, let’s say that a former homeowner engaged a construction company to build a pool, but the bill wasn’t completely paid. That outside firm could have rights to the property that were not otherwise evident. To uncover a similar scenario, the title company would conduct a thorough investigation into the property.

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.

A life estate is part of the estate planning process, and essentially means you are signing away partial ownership of your home to a beneficiary who will help pass the property onto your children or grandchildren. In the interim, you continue to live in and enjoy your home for years to come. When you come to the end of your life, the property transfers to the beneficiary named in your life estate. It is an early gift that you give to someone else to make the transfer happen quickly and easily. There will be no need for other legal documents or processes, such as a will or probate, for example.

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.

A balloon mortgage, on which you would make a balloon payment, typically has a short term of five to seven years. Your monthly payment amount, however, is based on a traditional 30-year mortgage term. Depending on the specific balloon mortgage type, you might be paying interest only on a combination of interest and principal each month. The key thing to remember about a balloon mortgage though is that at the end of said term, you’ll be responsible for making a lump-sum balloon payment for the balance of the loan.

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.

A reverse mortgage is a loan for homeowners 62 or older that allows them to access the equity in their home without having to make monthly mortgage payments. Unlike a traditional mortgage, where you pay down the loan balance over time, with a reverse mortgage, the loan balance increases.

How do reverse mortgages work?

Instead of making monthly mortgage payments, you receive funds from the reverse mortgage lender, which can be in a lump sum, monthly advances, or a line of credit. The borrowed funds, along with interest and fees, are added to your loan balance each month.

Who qualifies for a reverse mortgage?

To qualify for a HECM reverse mortgage, you must be 62 years or older, own your home outright or have a significant amount of equity in it, and live in the home as your primary residence. You will also need to undergo mandatory counseling from a HUD-approved agency to ensure you understand the implications of a reverse mortgage.

Are there closing costs associated with a reverse mortgage?

Yes, there are closing costs associated with a reverse mortgage, similar to a traditional mortgage. These costs can include origination fees, servicing fees, and third-party charges.

There are three main types of HECM reverse mortgages:

• Single-purpose: Funds are provided for a specific purpose, such as home improvements.

• Tenure: You receive fixed monthly payments as long as you live in the home.

• Line of credit: You have a line of credit that you can access as needed.

What happens when I no longer live in the home?

You (or your heirs) will need to repay the reverse mortgage when you no longer live in the home. This can be done by selling the home, refinancing the loan with a traditional mortgage, or in some cases, by selling some of the ownership interest in the home.

Are there alternatives to repaying the reverse mortgage by selling the home?

Depending on the specific terms of your loan, there may be alternatives to selling the home to repay the reverse mortgage. It's important to discuss these options with your reverse mortgage lender in advance.

Pros:

• Allows you to access the equity in your home to improve your cash flow.

• Can help you stay in your home longer.

• Doesn't require monthly mortgage payments.

Cons:

• The loan balance increases over time, reducing your home equity.

• Closing costs can be high.

• You are responsible for maintaining the home and paying property taxes and homeowners insurance.

When you are in the market for real estate, you may be like many first-time homebuyers who want to know, “how long does it take to buy a house?” The answer depends, of course, on several factors, but there is a way to gauge your expectations. And while it’s hard to pinpoint exactly how much time will transpire between finding the house of your dreams and signing on the dotted line, the good news is you won’t have to wait forever.  

Generally speaking, buying a home can take up to six months, but where you fall on the scale will depend on certain factors, such as whether you are paying for the house with cash or taking out a mortgage. Cash deals are harder to come by, but they will be faster. Otherwise, you might expect it to take closer to half a year if there are no contingencies that can slow down the process. In the interim, be prepared so that you won’t be delayed due to missing information. For example, know your credit score, get your pay stubs in order, have the down payment ready, and avoid racking up more debt in the meantime.

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.  

The underwriting process can take anywhere from several days to several weeks to complete. The timeline depends on factors ranging from how busy the underwriter is to how tricky your financial snapshot is. When you are granted conditional approval — or better yet get the all-clear via a closing disclosure with details of your mortgage from your underwriter — you are closer than you’ve ever been to the closing date.

The underwriting process is a system of checks and balances performed by, not surprisingly, the underwriter. This individual assesses your financial health to make sure that you can afford the mortgage. They will examine your income, debts, savings, credit profile, and more to make a final call. The underwriter also checks whether you are eligible for the type of mortgage loan you seek. 

Explore Total Mortgage’s Home Buyer Options 

Now that you know more than the average home buyer, you are well on your way to purchasing your dream home. Gone are the days of having to leave your fate in the hands of the local bank. Technology lends itself to a smooth mortgage process online. Get a personalized quote to learn how much you can afford.