Why should I choose David Talbot?

If there’s one thing that’s true about buying a home, or even refinancing one, it’s that you’ll always have questions. That’s why the most important thing you should look for in a mortgage broker is their knowledge and helpfulness.

At David Talbot your questions will be answered, the right program for your needs will be recommended, and you will kept abreast every step of the way. As a mortgage broker I have access to dozens of Conventional and FHA programs, including fixed rates, adjustable rates, balloons, first-time buyer programs and more. With David Talbot, it's even easier to get started with low down payments and relaxed qualifying guidelines. All of the programs offered are offered at their best competitive rate.

When should I lock in my interest rate?

To be an informed buyer, you’ll want to be aware of recent interest rate movements. Have they been falling or rising? Depending on the market, you may want to wait before locking in an interest rate, or may want to lock in as soon as possible. There is a lot of flexibility and decision to lock or float can only be made by you.

Should I pre-qualify or get pre-approval before I begin searching for a home?

Real Estate agents and home sellers will generally consider you a more serious buyer if you receive a pre-approval. Not only does it allow you to narrow your price range, it also assures the seller that you qualify when you do find the home of your dreams.

Once I apply, how long will it take before I receive an approval?

Generally it takes 14-21 days after you complete your application and all the required documentation is received. In some cases, in may only take 24-48 hours. However, some loan programs require additional documentation, resulting in a longer approval process.

Once approved, you will receive a written commitment letter outlining your rate (if already locked), terms, approval conditions and any additional documentation needed to close the loan.

What is my down payment?

This is simply the amount of money you choose to invest in your new home. The down payment and the loan amount make up the purchase price of the home. Some loan programs only require a 5% or 10% down payment. Other programs are available that even offer zero down payment options.

What are the advantages of making a higher down payment?

A higher down payment will reduce the size of the loan, as well as provide added strength to your ability to borrow.

The higher your down payment, the lower your monthly mortgage payment will be. In addition, your financing costs will be reduced because you will pay less interest over the term of the loan. It will also be much easier for you to qualify for a loan at the terms you select. Down payments meeting or exceeding 5% will generally remove the need for costly mortgage insurance, thereby lowering your payment even further.

Depending upon your tax bracket, it may be to your advantage to make a smaller down payment, thus maximizing your homeownership tax advantage.

Do I have a choice of points or no points?
How do I determine whether or not to pay points?

Yes, you do have a choice. The primary idea of points is to pay a fee at closing in order to lower your interest rate. Depending upon how long you keep your loan, you may save substantially more money over the life of the loan. Points are a good idea if you plan to keep your loan for a long time.

What is credit scoring?

A credit score is derived by analyzing a number of variables to determine the likelihood that a person will repay the loan on time. The scoring system was developed from a statistical analysis of variables that predict loan repayment patterns. Variables include late payments, delinquencies and credit history. A higher score is better.

What constitutes a loan approval?

Most lenders base their decision on three factors: credit, collateral and capacity. Credit refers to the quality of your current credit rating. Capacity is your ability to repay the loan based on job stability, current income and other factors. Collateral is the amount of equity in your home, and the likelihood of appreciation. Once everything checks out, you’re approved!

What is the maximum monthly payment for which I qualify?

A good rule of thumb is that up to 28% of your gross monthly income may be used for the payment of your mortgage, and up to 36% of your gross monthly income may be used for your total monthly debts (including your mortgage). However, there are programs available that offer a higher qualifying ratio.

What are discount points?

A discount point is a fee that you can pay to reduce your interest rate. One "point" equals 1% of the loan amount. For example, one point on a $100,000 loan would equal $1000. If you’re going to be in your home for a relatively short period, it may not be worth it to you to pay discount points. If you would like to lower your monthly payments by lowering your interest rate, then paying points up front may be the best way to accomplish this.

How much money will I need at closing?

Your closing costs will depend upon the sale price, the amount of your down payment and the various fees connected with the purchase of your home. Generally, conventional loans require a minimum of 5% to 10% of the sales price as a down payment. Closing costs and escrow items include mortgage insurance, prepaid taxes, attorney’s fees, title insurance, etc.