Williamsport Mortgages 101: A Primer On Getting A Home Mortgage

Which is better between renting and buying?  
 
This is a question that often lingers in the minds of many people. Deciding whether to rent or buy can be a tough decision. You need to consider several factors before deciding whether to buy a house or keep renting. One of the things to consider is your current financial situation. If you have enough money and the cost of rent is high in your area, then the best option would be to buy and start building equity, rather than continue renting. 
 
What distinguishes good real estate agents from bad ones? 
 
Williamsport Realtors play a crucial role in the buying and selling of property. But choosing the right Williamsport real estate agent can prove difficult. A good realtor puts your interest first. You should look for a realtor who is experienced and licensed to operate in your area. The realtor should also be prompt when it comes to attending to your issues. A real estate agent who is not experienced or licensed is not worth hiring. 

Shane Whitteker is the owner and chief broker at Principle Home Mortgage, Williamsport’s mortgage broker. 

“I would say it is a good idea to look into realtor reviews and get someone with a good amount of experience,” Whitteker advises. “If the realtor is newer, make sure they are on a team that has depth and availability.” 
 
Can I get a mortgage to construct a house?  
 
Building your home is a great idea. Yes, there are mortgages for people who want to build homes. One-time close construction loans are a great option to consider if you’re thinking about building your own home. As Whitteker explains, as opposed to traditional construction loans, one-time close construction loans save time, money, and hassle by combining the usual 2 closings of a traditional construction loan into one.  

"Some construction loans are a two-time close, meaning the construction loan portion is refinanced at the end of the construction phase,” Whitteker says. “This type of loan can come with higher closing costs.  A one-time close construction loan is just that, it is one loan that facilitates the construction of the home and is the final form of financing.” 
 
What are the best mortgages for me?  
 
There are different types of mortgage loans you can consider. The first one is a fixed-rate mortgage where the monthly payments and set and predictable. The second type is an adjustable-rate mortgage. This type of mortgage is ideal for someone who is not planning to stay in a home for long. Other types of mortgages include jumbo loans, conventional loans and government-issued loans. A government-issued loan is great if you have a poor credit score. 
 
How can I choose a good mortgage broker? 
 
Buying a home is a big deal. It is something that you wouldn’t want to gamble with by hiring just any mortgage broker. Look for a mortgage broker who is investment-savvy. Someone who has been in the industry long enough. Hiring a mortgage broker who is not experienced or doesn’t understand how the real estate market works can cost you heavily. 

“Williamsport does come with a number of mortgage broker options. Most of the brokers in the area are pretty competent,” Whitteker says. “A lot of us actually started working for the same company about 20 years ago.  Look at reviews and talk to the broker you are interested in working with to make sure they are a good fit and will represent you well as a borrower.” 
 
What type of mortgages should I go for? How will I know the one that’s best for my situation?  
 
Sometimes it can be difficult to decide which type of mortgage loan to consider. Start by understanding the types of mortgages available in the market. They include government-issued loans, jumbo loans, traditional loans, fixed-rate mortgages and adjustable-rate mortgages. It is up to you to scrutinize all these types vis-à-vis your financial situation.  

According to Whitteker, it’s a great idea to meet and discuss your situation with a local mortgage broker. 

“This is a good question to discuss with your mortgage broker,” Whitteker says. “Once they have your application and credit available for review, they will be able to properly advise you.” 
 

What are the requirements to get a mortgage? Is there anything that can ruin my chances?  
 
A mortgage lender requires several things in order to approve your loan request. These things include a credit score report, verifiable source of income, debt-to-income ratio (DTI), and down payment among other requirements. Some mortgage types are stricter than others. A low or bad credit score can easily prevent you from getting a mortgage, so make sure you pay your rent and other bills on time, every time. 
 
I have my mortgage – what next? 
 
After your mortgage loan has been granted, it means you have everything needed to get a house. The next thing is to proceed with buying your house. 

According to Whitteker, once you’re approved for a mortgage your home search can begin in earnest. 

“Once you are pre-approved you will start the house search. You will coordinate with your real estate agent to schedule times to see homes,” Whitteker says. “Once you find a home you want to make an offer on your real estate agent will negotiate on your behalf and hopefully you land the contract.  If you don’t get the contract, you keep looking and making offers until you get a house under contract.  Then the real mortgage work starts and you work with your broker to fulfill the mortgage qualification requirements.” 
 
What hidden costs can a new homebuyer forget?  
 
According to Whitteker, the days of “hidden” costs are over.   

“There aren’t really “hidden costs” in the mortgage process anymore,” Whitteker explains. “This is a pretty regulated environment in mortgage lending, and the days of hiding costs are over fortunately.  This certainly is a benefit to borrowers and also to brokers.  When people were able to hide costs, it was a little bit harder for an honest broker to compete.” 

While unsavory “hidden” fees are a thing of the past, there are some costs that go overlooked by prospective home buyers. One of these costs is the home inspection fees. After making an offer, the next step should hire a professional home inspector to uncover any mechanical, structural or other issues. Other often forgotten costs include appraisal fees, escrow account fees, closing costs and home repair costs. 
 
What is a HELOC? How do I qualify for a home equity line of credit?  
 
Whitteker says this depends on a few factors unique to each home owner. 

“This really comes down to the amount of equity in your home,” Whitteker says. “There is no specific time frame for refinancing.  A HELOC is a home equity line of credit.  This is a loan that is typically in second lien position behind your first mortgage.  A HELOC is a revolving account similar to a credit card.  You can pull money out when you need it up to your loan limit.” 
 
How can I take advantage of my home equity?  
 
Cash-out refinance loans is one way to tap into your home’s equity. This means applying for a new mortgage loan. The new loan will be enough to clear your current home loan and remain with extra money. You can also apply for a home equity loan or opt for a home equity line of credit. For older homeowners, a reverse mortgage may be worth considering to help access the home’s equity.  

To learn more about getting a home mortgage in Williamsport, Pennsylvania, visit the experts at Principle Home Mortgage or call them at (570) 980-9359.