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1. How do I know how much house I can afford? Answer
2. What is the difference between a fixed-rate loan and an adjustable-rate loan? Answer
3. How is an index and margin used in an ARM? Answer
4. How do I know which type of mortgage is best for me? Answer
5. What does my mortgage payment include? Answer
6. How much cash will I need to purchase a home? Answer
7. I have heard of the HARP 2.0 Program. What is this Program? Answer
8. Do I qualify for the HARP 2.0 Program? What are the requirements? Answer
9. How or where do I apply for the HARP 2.0? Answer
10. Do you have Stated Loans? Are these loans still being offered? Answer
11.  My home was foreclosed, when can I buy a home again? Answer
12. What is a Reverse Mortgage? Do I qualify? Answer
13. What are the Benefits of a Reverse Mortgage (HECM)? Answer

Q : How do I know how much house I can afford?
A : Generally speaking, you can purchase a home with a value of two or three times your annual household income. However, the amount that you can borrow will also depend upon your employment history, credit history, current savings and debts, and the amount of down payment you are willing to make. You may also be able to take advantage of special loan programs for first time buyers to purchase a home with a higher value. Give us a call, and we can help you determine exactly how much you can afford.
 
Q : What is the difference between a fixed-rate loan and an adjustable-rate loan?
A : With a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, typically in relation to an index. While the monthly payments that you make with a fixed-rate mortgage are relatively stable, payments on an ARM loan will likely change. There are advantages and disadvantages to each type of mortgage, and the best way to select a loan product is by talking to us.
 
Q : How is an index and margin used in an ARM?
A : An index is an economic indicator that lenders use to set the interest rate for an ARM. Generally the interest rate that you pay is a combination of the index rate and a pre-specified margin. Three commonly used indices are the One-Year Treasury Bill, the Cost of Funds of the 11th District Federal Home Loan Bank (COFI), and the London InterBank Offering Rate (LIBOR).
 
Q : How do I know which type of mortgage is best for me?
A : There is no simple formula to determine the type of mortgage that is best for you. This choice depends on a number of factors, including your current financial picture and how long you intend to keep your house. RiverGold Financial Services can help you evaluate your choices and help you make the most appropriate decision.
 
Q : What does my mortgage payment include?
A : For most homeowners, the monthly mortgage payments include three separate parts:
  • Principal: Repayment on the amount borrowed
  • Interest: Payment to the lender for the amount borrowed
  • Taxes & Insurance: Monthly payments are normally made into a special escrow account for items like hazard insurance and property taxes. This feature is sometimes optional, in which case the fees will be paid by you directly to the County Tax Assessor and property insurance company.
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    Q : How much cash will I need to purchase a home?
    A : The amount of cash that is necessary depends on a number of items. Generally speaking, though, you will need to supply:
  • Earnest Money: The deposit that is supplied when you make an offer on the house
  • Down Payment: A percentage of the cost of the home that is due at settlement
  • Closing Costs: Costs associated with processing paperwork to purchase or refinance a house
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    Q : I have heard of the HARP 2.0 Program. What is this Program?
    A : If you - like many borrowers -  are underwater (meaning you owe more than the current market value of your home) on your conforming, conventional mortgage, you may be eligible to refinance without paying down principal and without having to pay mortgage insurance.
     
    Q : Do I qualify for the HARP 2.0 Program? What are the requirements?
    A : To be eligible to refinance under this program you must meet the following criteria: 

    1. Your loan must be owned or guaranteed by Fannie Mae or Freddie Mac.                                       

    2. Your loan must have been obtained on or before 05/31/2009.                                                      

    3. You must be current on your loan payments at the time of refinance, with no late payment in the past six (6) months and no more than one late payment in the past twelve (12) months.                         

    4. Your loan cannot have been refinanced under HARP previously unless it is a Fannie Mae loan that was refinanced under HARP from March-May 2009.

     
    Q : How or where do I apply for the HARP 2.0?
    A : To take advantage of this Program, you need to find out if your loan is owned or guaranteed by Fannie Mae or Freddie Mac. Call us for more details and to find out if you qualify for the HARP 2.0 Program. This program has been extended to December 31, 2015.
     
    Q : Do you have Stated Loans? Are these loans still being offered?
    A : There are no stated loans anymore. But if you have very limited cash downpayment, there is a FHA loan program in which you can pay the required 3.5% home purchase downpayment as follows:  1/2% down on a 1st loan, and the remaining 3% will be a second loan. Call us for more details and pre-qualification.
     
    Q :  My home was foreclosed, when can I buy a home again?
    A : If your home was foreclosed 2 years ago or more, you may qualify for a FHA loan program. Your current financial situation, including employment, credit scores, etc., are factors in determining your qualifications. Call us for more details. 
     
    Q : What is a Reverse Mortgage? Do I qualify?
    A : A "Reverse" Mortgage (HECM) is a loan against your home that you do not have to pay back for as long as you live in the property. To qualify: 1. You must be a homeowner, 62 years of age or older, and the home MUST be your primary residence. 2. The home must comply with HUD'S minimum guidelines for occupancy. The loan can be used for repairs to property. 3. Free and clear property is not a requirement. Homes with existing mortgage balances qualify as well. 4. Properties that qualify are single family homes, condominiums*, townhomes, mobile homes*, and multifamily homes up to 4 units*. * Certain Restrictions apply for condominiums, mobile homes and multifamily homes. 5. HUD requires HECM counseling for all borrowers and spouses who are applying for a Reverse Mortgage (HECM). The counseling session will go over all aspects of the Reverse Mortgage (HECM).
     
    Q : What are the Benefits of a Reverse Mortgage (HECM)?
    A : Never make another mortgage payment while you live in the property. You can pay-off existing debt and pay-off credit cards. Money can be used without restrictions. You can receive money in a variety of payments options: Lump Sum; Monthly Payments; Credit Line; Tenure; or a combination of it. You can pay-off bankruptcy or pending foreclosure. You can do home improvements. Go on vacations. Supplement your monthly income. There are no limits to how the money can be used. There is no tax liability. Any money received from a Reverse Mortgage (HECM) is free of any kind of income tax or capital gain tax. The money is not considered income. Call us (714)277-3586 or email us and we'll mail you a free information guide.