What costs are associated with obtaining a home loan?
You will be required to pay for appraisal costs, credit report fee, flood certificate, attorney and abstracting fees, recording fees, and charges to originate your loan. There may be additional costs depending on any additional services you choose.
What types of loan products does First National Bank in Creston offer?
We provide ARMs, Balloons, and HELOCs. We can also provide fixed-rate mortgages sold through the secondary market, VA loans, FHA, and Iowa Finance Authority Rural Development loans through our sister bank.
What additional expenses will I have after purchasing a house besides the monthly payment for principal and interest?
You will have to pay for property taxes to your county treasurer. In addition, the Bank requires that you carry hazard insurance to protect your property in the event of a loss. Flood insurance will also be required if your house is in a flood hazard area. Depending on the location of your home, you may also have homeowner association dues.
How much can I afford?
To determine how much you can afford, you first need to know your monthly income. Second, you will need to calculate your monthly expenses which may include credit card bills, car payments, insurance premiums, student loans, child support, alimony, and all other debts. After subtracting your debts from your income, you can determine how much you are willing to pay every month for your home. Our loan officers would be happy to discuss your particular situation with you to help you determine the amount you can spend for a home and pre-qualify you for a purchase.
What is an ARM?
ARM is an acronym for Adjustable Rate Mortgage. This is a mortgage product that allows the lender to periodically adjust the interest rate according to the specified index which could be either up or down. The interest rate may have a floor and a ceiling which is the lowest and maximum interest rate throughout the lifetime of the loan. With an adjustment in interest rate, the loan payments may go up or down accordingly.
What is a Balloon Mortgage?
This is a mortgage product that has a balloon payment due after an initial period of monthly payments. After that period of time elapses, the balance (balloon) must be refinanced OR be paid by the borrower. The large sum payable at the end of the loan term is called the “balloon payment”.
What is a HELOC?
A Home Equity Line of Credit is a form of revolving credit in which your home serves as collateral. Once approved for a HELOC loan, you will most likely be able to borrow up to your credit limit whenever you choose. Repayment is set over a fixed period, for example, 10 years.