Q: I want to get a mortgage. What do I do first?
A: To get started, meet with a Uwharrie Bank Mortgage lender. We can help get you prequalified. This takes the guesswork out of shopping for a home because you will know your target price range.
Q: How do I get prequalified for a mortgage loan?
A: In order to qualify for a mortgage loan with Uwharrie Bank, four factors are taken into consideration:
Creditworthiness – A history of good credit and a positive credit rating are essential to obtaining a mortgage loan.
Repayment Ability – As a general rule, the sum of your loan principal, interest, taxes and insurance should not exceed 28 percent of your gross monthly income. In recent years, these ratios have become much more liberal, taking into account a variety of factors to determine your repayment ability.
Marketability of Property – Uwharrie Bank will order an independent appraisal of the property you’d like to finance. The appraisal is reviewed to ensure the property meets loan guidelines. In most cases, the value of the property should meet or exceed the property’s sales price.
Sufficient Funds for Closing – The amount you will need for closing varies depending upon the loan program you choose.
Q: What happens after I’m prequalified for a mortgage?
A: After you’re prequalified, you can start shopping for a home. Make a list of all the “must-have,” “nice to have” and “cannot have” features that are important to you, and share this information with your real estate agent.
Q: What happens when I find a home I want to purchase?
A: When it comes time to make an offer on a home, your real estate agent will guide you through this process. It typically starts with submitting a formal offer to the sellers or their agent. This letter would include the amount of your offer and any conditions you’d like to include. Before you make an offer, you will want to make sure the asking price is in line with other homes in the area. You’ll also want to consider the current condition of the home. Is it “move-in ready” or will you have to make substantial improvements? If the home needs major upgrades or has been on the market for a long time, you might consider submitting a lower offer. A good real estate agent will know this process well and can provide solid advice.
Q: Do I need a fixed-rate or an adjustable-rate mortgage?
A: A fixed-rate loan has one interest rate that stays the same throughout the term of the loan, while an adjustable-rate loan is linked to the prime interest rate and can change over time. Adjustable-rate mortgages (called ARMs) are often popular because they offer low rates in the beginning, but borrowers need to be cautious of how a higher monthly payment would impact their budgets if the rate rises. One of the main factors to consider in deciding between these loans is the length of time you plan to stay in the home. A Uwharrie lender can help you decide which is right for you.
Q: What are closing costs?
A: Closing costs are fees for various items that you have to pay at closing. These can include appraisal fees, title insurance fees, attorney fees, pre-paid interest and documentation fees, among others. The fees can vary depending on the type of mortgage and your location. We will make sure you receive a loan estimate of closing costs within three days of application.
Q: How long does it take to close?
A: Once the deal is negotiated, homeowners are usually excited and ready to move in right away. But, remember, it can take several days and sometimes weeks from the time you apply for your loan until the time that you close on the house. Uwharrie works with in-house underwriters, so we will do everything in our power to move the process along as quickly as we can.
Q: Shouldn’t I work with a large regional or national mortgage lender?
A: One of the biggest benefits of working with Uwharrie’s mortgage lending team is that you are our friends and neighbors and we truly care about making a difference in our communities and in the lives of our customers. Our rates and terms are competitive—and we’re friendly, respectful and responsive to your needs. With local underwriting and personal attention from our expert mortgage lenders, we can offer so much more than a big bank.