Common Questions
What is the
difference between pre-approval and pre-qualification?
The pre-approval process
is much more complete than pre-qualification. For pre-qualification,
the loan officer asks you a few questions and provides you with a pre-qualification
letter. Pre-approval includes all the steps of a full approval, except
for the appraisal and title search. Pre-approval can put you in a better
negotiating position, much like a cash buyer.
When does it
make sense to refinance?
Usually people refinance
to save money, either by obtaining a lower interest rate or by reducing
the term of the loan. Refinancing is also a way to convert an adjustable
loan to a fixed loan or to consolidate debts. The decision to refinance
can be difficult, since there are several reasons to refinance; however,
if you are looking to save money, try this calculation:
- Calculate
the total cost of the refinance
- Calculate
the monthly savings
- Divide the
total cost of the refinance
(#1) by the monthly savings (#2). This is the "break even"
time. If you own the house longer than this, you will save money by
refinancing.
Since refinancing is
a complex topic, consult the mortgage professionals at Hourglass Capital
Group.
What is a rate
lock?
A rate lock is a contractual
agreement between the lender and buyer. There are four components to
a rate lock: loan program, interest rate, points, and the length of
the lock.
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Hourglass Capital Group, LLC
Four Titus Road
P.O. Box 566
Washington Depot, CT 06794-0566
info@hourglassmortgage.com
Phone: 860.868.2810
Toll Free: 888.HR.GLASS or 888.474.5277
Fax: 860.868.2610
© 2004-2006 Hourglass Capital Group, LLC. All rights reserved.
