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» What types of loans does Lenders Direct offer to purchase a house?
» What does a Bank look at to approve me?
» How do I know what my interest rate will be?
» What exactly are Points, and will I have to pay any?
» Can I pick my own interest rate?
» I'm self-employed; can I still qualify with Lenders Direct?
» I don't need to take out money now, how can I be prepared on short notice in the future?
» How do I calculate my loan to value ratio (LTV)?
» Can I make extra payments to principle so I can pay off my loan more quickly?
» What are the tax advantages of having a mortgage?
» Does Lenders Direct offer loans for Mobile Homes (manufactured houses)?
» How do I qualify for a loan?
» How do I receive my loan documents?
» How do I refinance my existing loan?
» How much can I borrow?
» Can I put the fees into the new loan?
» Why is the Loan to value so important?
» Can I get a second mortgage if I need more cash?
» How do I know how much equity in my property?
» How do I calculate the value of my property?
What types of loans does Lenders Direct offer?
Since Lenders Direct is a full service bank, we have all the normal fixed rate programs. We also offer adjustable rate mortgages, and loans that allow the borrower to state their income and assets. Now that's flexibility.
We are committed to that "full service" concept, so we also have equity loans for debt consolidation or home improvement either as a fixed rate or as a line of credit that you can draw on when needed.
But full service also means that we offer loans even when you have no equity in your home. That's correct we can lend money in many cases when there is no equity at all. As a bank we are constantly looking for ways to expand the programs that make us a full service banking institution.
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What does a Bank look at to approve me?
At the heart of approving a potential borrower is what lenders call "the three C's"
- Credit -- your credit history
- Collateral -- the value of the property securing the loan (your house)
- Capacity -- your financial ability to assume and repay debt
Taken together, these create a portrait of a potential borrower's risk -- that is, whether or not we can expect the loan to be repaid. If the risk seems high, the lender will be reluctant to make the loan. Depending on the degree of risk, a lender may choose to charge higher rates and/or fees, or decline to make the loan altogether.
Traditionally, all three were of equal importance. Lenders Direct, however, places the most stress on your Collateral. If you have equity we can usually find a program that will meet your needs. In any case we will always offer you options we think that's the more direct approach.
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How do I know what my interest rate will be?
Rates vary primarily based on the type and purpose of the loan, your credit history and income, loan amount, value of the property, and the number of points you are willing to pay.
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What exactly are Points, and will I have to pay any?
Generally speaking, points are fees added onto loans used to buy down the rate. One point is equal to 1 percent of your loan amount. Points are paid when the loan closes, not at the time you apply for the loan.
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Can I pick my own interest rate?
Points are paid when the loan closes, not at the time you apply for the loan. Generally speaking, points are fees added onto loans. One point equals 1 percent of the loan amount.
When you get a loan, you'll have the opportunity to "buy down" the interest rate by paying discount points -- essentially paying a fee to lower your interest rate.
By lowering your interest rate, you will be lowering your monthly payment and the amount of interest you'll be paying over the life of the loan. You pay more at the beginning of your loan but will save money in the long run. Keep this in mind as you determine whether to pay points.
Paying points requires a higher immediate expenditure, so it may not be for you. In that case, let the loan do its job -- allowing you to borrow the money you need and pay it back as you can.
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I'm self-employed; can I still qualify with Lenders Direct?
Of course, Lenders Direct provides loans to individuals who are self-employed. Income documentation may be requested with certain loan products and we have many programs that require no income or asset documentation at all... it's all part of working with a full service bank, not a loan broker.
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I don't need to take out money now, how can I be prepared on short notice in the future?
If you want a reserve of funds you can draw on in the future, choose our Home Equity Line of Credit. You'll have the credit you need when the need arises - and you make no monthly payments until you draw on it. Be ready for future expenses like medical bills, emergency home repairs, tuition, and more.
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How do I calculate my loan to value ratio (LTV)?
The loan-to-value ratio (or LTV) is one of the most important factors in your loan process. It is used to determine the limits within which your housing and debt ratios must fall for you to be approved. It can also determine which fees you will be charged for your loan and the amount of these fees. It will also determine whether you must pay Private Mortgage Insurance (PMI) and use an impound/escrow account.
Your loan-to-value ratio (LTV) is simply the amount you are borrowing divided by the value of the subject property you are purchasing or refinancing. This gives you a simple ratio. For example, a house valued at $100,000 which you intend to purchase with an $80,000 loan (and a $20,000 down payment of your own cash) is said to have an LTV of 80 percent -- that is, the loan represents 80 percent of the value of the house.
The value of your property is its appraised value OR the amount you pay for the property (the market value), whichever is lower. In the initial stages of qualification and approval, your property's value is understood to be an estimate. It will be confirmed, if necessary for your particular loan, by a professional appraiser hired by Lenders Direct.
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Can I make extra payments to principle so I can pay off my loan more quickly?
Depending on the loan, and what your state permits, it is possible for you to make extra payments on the loan. Extra payments will have an effect on the amortization schedule over the remaining term of your loan.
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What are the tax advantages of having a mortgage?
You should consult a tax attorney or accountant for specific details, but interest on a mortgage is usually tax deductible. Interest on credit cards or automobile loans is not normally tax deductible.
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Does Lenders Direct offer loans for Mobile Homes (manufactured houses)?
In some cases, Lenders Direct will provide loans on manufactured houses that follow the same guidelines for other types of construction. These houses must be at least a "double-wide" and be permanently attached to a foundation. In addition Lenders Direct has programs available to manufactured homes that are not on a permanent foundation, in many cases the home can be a singlewide where you don't even own the land. Call for more details on these custom programs.
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How do I qualify for a loan?
Lenders use specific criteria to determine if you qualify for a loan and the amount you can qualify for. To determine whether you can qualify for a loan, the types of loan products that are best for you, and many other things. Lenders Direct allows you to apply and get approved right here online -- it's fast, easy, and free (Lenders Direct charges no application fee).
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How do I receive my loan documents?
After you complete your application with a loan agent, Lenders Direct will provide you with a package in one of two ways: via e-mail or via express mail. This package will contain your loan application and disclosure documents.
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How do I refinance my existing loan?
To refinance your loan in order to obtain a lower interest rate and start saving on your monthly payments, Lenders Direct can offer you any one of a number of loan products and at the same time keep the security of working with a full service bank. Since Lenders Direct is a full service bank, we have all the normal fixed rate programs. We also offer adjustable rate mortgages, and loans that allow the borrower to "state" both their income and assets. These low Documentation or even no documentation loans offer a degree of flexibility that is very unusual in the direct to the consumer lending market..
We are committed to that "full service" concept, so we also have equity loans for debt consolidation or home improvement either as a fixed rate or as a line of credit that you can draw on when needed. Just in case you need more cash than the 1st mortgage program will allow.
But full service also means that we offer loans even when you have no equity in your home. That's correct we can lend money in many cases when there is no equity at all. As a bank we are constantly looking for ways to expand the programs that make us a full service banking institution. For example:
"NO FEES" OPTION
Our No-Fees option allows you to refinance with few upfront fees*. While the rate is slightly higher, you will pay few upfront fees for your new loan. In effect, as long as our "no fees" rate is lower than your existing rate, it makes financial sense to refinance because there is little or no cost in doing so.
CASH OUT OPTION
If your equity in your property qualifies, you can refinance with a loan amount greater than your current mortgage -- and keep the difference! Use it for home improvement, debt consolidation, or whatever you want.
*A 'No-Fees" loan is one that the lender pays all non-recurring closing costs for the borrower. The borrower is still responsible for paying all prepaid interest, property taxes, and hazard insurance, as well as all other recurring items. Minimum loan amount for the "No-Fees" program is $150,000. Closing costs assume that the borrower will escrow monthly property tax and insurance payments.
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How much can I borrow?
Apply and Lenders Direct will work with you to understand your individual needs. We will collect all of the pertinent information from you (a fax will be fine) and offer you the best options based on who you are, and what you are tying to accomplish. We don't advertise programs and rates that few people, if anyone, can qualify for. Those are for people with perfect credit, and most of us are not perfect. Instead we think it's more direct to understand your needs and then show you what programs that you are qualified for. If you happen to be one of the few people with perfect credit, then that's good news, and you will likewise see the programs and rates that your situation warrants. In both cases, by being direct, we promise to not waste your time.
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Can I put the fees into the new loan?
The choice basically comes down to "pay now" or "pay later." If you have the funds now, it makes sense to cover the expenses out-of-pocket and save through lower loan payments and interest costs on a smaller loan. On the other hand, if your budget is currently tight, rolling in the costs with your loan amount makes sense because it allows you to get the loan without immediate expense. We think you should be able to choose the plan that is best for you.
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Why is the Loan to value so important?
Your loan-to-value ratio (LTV) shows your equity in the property. Your equity is basically the amount of the property you own, expressed as a monetary figure. Another way of thinking of your equity is that it's the amount of money you'd receive if you sold your property at its valued price, less what you'd have to return to your lender to repay the loan. Example: $100,000 value minus $50,000 to repay loan = $50,000 equity. Your LTV and equity are crucial because common wisdom among lenders is that the higher the LTV (and the lower the equity), the higher the risk of a borrower defaulting on his or her loan. Thus, low equity loans present lenders with greater risk. Where many brokers fail, a full service bank like Lenders Direct is able to offer programs even when you have little or no equity. W currently have programs that will allow you to purchase a property with zero money down.
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Can I get a second mortgage if I need more cash?
Lenders Direct offers several solutions to borrow funds against your existing property value.
· Home Equity Line of Credit
If you want a reserve of funds you can draw on in the future, choose our Home Equity Line of Credit. You'll have the credit you need when the need arises -- and you make no monthly payments until you draw on it. Be ready for expenses like medical bills, emergency home repairs, tuition, and more.
· Home Equity Loan
If you want to borrow up to 100 percent of your home's value at a fixed rate of interest, choose our Home Equity Loan. Use those funds for a purchase opportunity, home maintenance, debt consolidation, or major expenses.
· High loan-to-value
If you want a large sum of cash, choose one of our High Loan-To-Value product -- 125 percent zero equity products. With low equity -- even no equity -- Lenders Direct can still loan you the funds you need to make home improvements, consolidate debt, buy a car, or make an investment.
To learn more about these and other products, call us any time at 1-877-935-6262.
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How do I know how much equity in my property?
Equity is the value of a homeowner's interest in real estate. Equity is computed by subtracting the total of the unpaid mortgage balance and any outstanding liens or other debts against the property from the property's fair market value. A homeowner's equity increases as he or she pays off his or her mortgage or as the property appreciates in value. When a mortgage and all other debts against the property are paid in full, the homeowner has 100 percent equity in his or her property.
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How do I calculate the value of my property?
Since a mortgage is a loan secured by a piece of real property, a crucial factor is in the correct value of the property in question. Property value can be determined in a number of ways:
The market value of the property -- that is, what a buyer will pay for it and what other comparable properties (comps) in the neighborhood have recently sold for.
The appraised value of the property -- that is, what a trained and licensed professional deems the property to be worth based on an inspection, comps, and a thorough analysis of the property and its neighborhood.
Lenders Direct has some programs that allow the borrower to "state" the value. You tell us what the property is worth and we'll work with that. Now that's full service.
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