Home Purchase/Refinance
Home Purchase - Home Buying Tips
We'll Guide You Every Step Of The Way
F&M mortgage lenders have the expertise – and will take the time – to personally lead you through the home loan process. From the day you apply for your loan ... until you're unlocking the door to your new home ... we'll be right there for you! In five basic steps, here's what you can expect:
STEP 1: Meet With A Loan Originator/Officer
An F&M Bank mortgage loan originator/officer will meet with you to explain everything you can expect to encounter when buying a home. We'll meet at a time and location that's convenient for you and will answer many of your questions. The first meeting lasts about an hour. If you do not have time to meet with one of our staff, you may apply on-line and receive a response by the next business day. To get the greatest benefit from this initial meeting, please bring the following:
Income – Your last two paycheck stubs ... and a listing of all sources of monthly incomeExpenses – Accurate list of monthly obligationsBank Accounts – Your last two statements for checking, savings and CDsLoans & Credit Cards – Balances due to banks, finance companies and credit card companies (bring copies of your most recent statements)Last Year's Tax Return – Or last two years if self-employed.Equity In Your Home – If you own your residence, EQUITY is the difference between what your house is worth and what you owe. Copies of the most recent property tax assessment and monthly mortgage statement would be helpful.
STEP 2: Pre-Qualify For Your Loan ... Then Go House-Hunting
An important step in purchasing a home is determining what you can afford to spend on the monthly mortgage payment. That amount depends on your employment status, current debt, family size and other factors such as current interest rate. We will quickly evaluate your financial situation and give you an on-the-spot estimate of what you can afford. Then you'll be ready to shop for homes that are in your price range ... saving you time, effort and money. We can even PRE-QUALIFY your application so that you can shop with CONFIDENCE when making an offer on a new home.
We have underwriters on staff to issue approvals quickly. Our applications go from origination to underwriting and then to be processed. By underwriting the files immediately after application, this alleviates the guesswork on final approvals.
STEP 3: Apply For A Loan
During the initial meeting with your mortgage loan originator/officer, you'll receive a loan application that requests additional financial, employment and personal information. The more complete you are in supplying this information, the faster we'll be able to process, approve and close your loan. To get a "jump start" on the application process, Click here to find a lender and start the mortgage process.
Your F&M loan originator/officer will ensure you apply for the right type of loan by explaining your payment options and terms. We'll also help you explore special loan programs such as VA, FHA and THDA Click here for Special Financing Options. We'll work closely with you to select a mortgage that's a SMART CHOICE for you!
STEP 4: Consider All The Costs
Once you've decided on the home you want, you need to be aware of expenses beyond your monthly mortgage such as property taxes, insurance and utilities.
For Previously Owned Homes:
- Ask the present owners or your real estate agent for records of these expenses
For New Homes:
- Property Taxes – Request estimates through your local tax assessor's office
- Homeowner's Insurance – Contact your insurance agent to obtain an estimate
- Utilities – Most public utility companies will provide an expense estimate based on the size and construction of the home
Pass this information to your mortgage loan originator/officer for review before you sign a real estate contract.
F&M Bank will also make sure you FULLY UNDERSTAND your closing costs by providing you with a good faith estimate. By reviewing this estimate prior to the loan closing, you can plan your expenses and avoid last-minute surprises.
STEP 5: The Loan Closing
The final stage in the loan process is the Loan Closing. It's the date on which the title for the property passes from the seller to the buyer ... and the day you take legal ownership of your new home! During closing, all details are finalized, paperwork is completed, checks are exchanged, fees are paid and you receive the deed and keys to your property. The meeting usually is conducted at the bank or an attorney's office and lasts about an hour.
Before closing day, we'll make sure you fully understand your closing costs so you can plan your expenses – avoiding last-minute problems. Closing costs vary depending on financing, but they generally include items such as down payment, appraisal fees, prorated property taxes and insurance, attorney's fees and lender's fees and expenses.
After closing, we may assign, sell or transfer servicing of your loan to a mortgage company. This allows us to offer competitive financing options to give you the best possible rate. However, we will be available to answer any questions you may have should your loan be sold.
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Fixed Vs. ARM
Types of Loans
There's a range of mortgage choices available for home purchases. Some offer monthly payments that are set for the life of the mortgage, while others feature smaller initial monthly payments that will fluctuate with interest rate changes.
Interest first products are now offered which will help lower your monthly payment durring the first 5, 7, 10 or 15 year period by allowing you to pay interest only. These programs are offered with both fixed rate and adjustable rate terms.
Fixed Versus Adjustable Rate
Fixed-Rate Mortgage – This type of financing features an interest rate that is set for the life of the loan, offering predictable monthly payments for up to 30 years. This loan usually has a higher interest rate than an adjustable rate mortgage.Adjustable Rate Mortgage (ARM) – ARMs normally start with an interest rate that is lower than fixed-rate mortgages. But the interest rate (and your monthly loan payment) will move up or down according to market conditions. Most ARMs have interest rate caps both annually
and over the life of the loan to help prevent dramatic changes in rates.Fixed period ARMs which offer you a fixed rate for either the first 3, 5, 7, and 10 years with the remainder of the term adjusting annually.
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Special Home Loan Financing*
F&M Bank offers several government-sponsored home ownership incentive programs. These special financing options are designed to lower your interest rate, down payment amount and/or closing costs. Here are a few examples:
- Federal Housing Association (FHA) Loans – These loans offer the benefit of a low, 3-5% down payment. And sometimes, closing costs can be included into the loan amount to further reduce up-front costs.
- Veterans Affairs (VA) Loans – VA loans make 100% financing available to qualified military veterans with at least six months of active duty. This loan is also available to the unmarried spouses of a deceased veteran whose death was service related, or spouse of an MIA or POW.
- Tennessee Housing Development Association (THDA) Loans – First-time buyers, or those who have not owned a home within at least three years, may qualify for these lower-down-payment loans (financing is subject to the availability of state funding).
- USDA-Rural Development Loans- This program offers 100% financing for rural properties provided program guidelines are met. The rates are very competitive and you do not have to be a first time homebuyer.
*For all of the products listed (i.e., FHA, VA, THDA, and USDA Program) the interest rate and terms are subject to credit review and approval.
Home Refinance
Refinance and Save!
When interest rates drop by at least 1.00% below your existing loan rate, it may be a money-saving SMART CHOICE to refinance your loan. Contact F&M Bank to help you determine if refinancing can help you:
- Reduce Your Interest Rate – A lower interest rate means lower payments
- Reduce Your Mortgage Term ... And Pay Off The Loan Faster – Refinancing to a shorter term mortgage can save you thousands of dollars in interest charges over the life of the loan
- Convert Your Equity Into Instant Cash – Borrowing against the equity in your home can be a low-cost and often tax-deductible way to get extra money (please consult with your tax adviser). Plus, mortgage interest rates are usually lower than other types of consumer loans. We can help you unlock cash from your home's value with a Home Equity Line of Credit that allows you to "write yourself a loan" at your convenience ... or a fixed term Home Equity Loan (subject to separate application and approval).
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Meet Our Mortgage Team and APPLY ONLINE!
Institution NMLS ID #518158
