1. Purchases: Most interest rates you see quoted in the newspaper/internet/T.V. are the "base rates" & assume that the borrower is putting at least a 5-10% down payment on the house they are purchasing with a loan amount of at least $100,000. If a borrower wants to put only 3% down, the rate is a slight bit higher than the "base rates". If a borrower doesn't want to put any money down ($0 down program), the rate is slightly higher than putting 3% down. In other words, if you want to purchase a house with limited funds (under 5% down), expect the interest rate to be slightly higher than the current base interest rates.

2. If you are Self-Employed, expect to furnish your Mortgage Analyst with your last 1-2 years' Federal tax returns-all pages. Your income will be calculated from your "Net income" that you report to the IRS. (If you elect to prove your income)

3. Stated Income- this program is for self-employed borrowers who do not/cannot prove their income and simply want to "state" their income. Because you are not proving income, expect your interest rate to be slightly higher than the current base interest rates.

4. Understanding your Credit- Most borrowers know it is important to pay your bills on time, but what they don't know is that it's almost equally as important to your credit score not to "max-out" your credit cards/debts! Credit scores range from 300-900 and are determined by each of the 3 credit bureaus (Equifax, Experian and Transunion). Lenders use these scores to assist them in underwriting a possible borrower's credit risk, which in turn reflects in the interest rate the borrower is subsequently offered. The higher the credit score, the lower risk the borrower (in other words, the higher the score, the better). "A" credit borrowers with high credit scores do not owe more than 30% of the credit limit/high balance on each of his/her credit cards/debts, have had no bankruptcies/liens, no late payments in the past 2 years (at least), no more than 1-2 installment loans, and have no more than 2-3 credit cards.

5. If you are a 1st time homebuyer, you may want to consider an ARM (sometimes called fixed/adjustable). If you believe that you will be "moving up" to a larger home once you are more established in your career, a 3 or 5 yr. ARM might be perfect because it offers you a lower interest rate during the fixed period that the current "fixed rates", and you may sell the house or refinance before it begins to adjust!

6. Tidbit: The average homeowner keeps their mortgage 7 years. This means that the average homeowner either sells their home or re-finances into a new mortgage every 7 years.

7. Cash out Refinances- anytime a borrower refinances their current mortgage and also gets extra money to payoff a 2nd mortgage/consolidate debt/home improvements/go on vacation, whatever, it is considered a "Cash out Refinance". These are extremely popular, as the mortgage interest is usually tax deductible*, and the interest rate is usually only slightly higher than the base rates.

8. Did you know that you can refinance your mortgage into a 30, 25, 20, 15, 10 or 5 year term mortgage?

9. More Questions? Please email us at Info@gcmortgage.com and we'll be happy to answer any questions that we have not addressed.