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Mortgage Loan Information

Answers to Common Questions About Mortgage Loans

Q. How can I get information about mortgage loans?

A . There is mortgage loan information and mortgage rates available on this site and all of these lenders offer online mortgage applications or application by phone. Either way is the fastest way to shop and be approved for a mortgage.

Q. How large of a down payment will I need?

A. Depending on the loan amount, you may be able to put down as little as 3% of the loan. Down payments vary according to loan programs, so please consult the lenders on this website.

Q. Does my credit have to be perfect?

A. Your ability to purchase a home will depend, in part, on your credit history as profiled in a credit report. The information on the report is used to help us determine how responsible you are in meeting your obligations. You do not need perfect credit to be approved for a mortgage though. Lending Tree mortgage offers loans to meet most borrowers' needs, and one of our mortgage professionals can answer your questions, help you compare programs and select a mortgage.

Q. What kind of mortgage loan should I apply for?

A. Once you?re ready to buy a home, you need a mortgage that fits your budget and your financial objectives.Complete an application that will compare rates and terms at multiple lenders to give you the best deal.

Q. What is PITI?

"PITI" stands for Principal, Interest, Taxes and Insurance and represents the total monthly payment you will make each month to your lender and includes principal and interest on the mortgage, real estate taxes, and homeowners insurance. If you will be paying private mortgage insurance or condo association fees, these monthly payments will also be included in the "PITI" amount.

Q. What are points?

A. Points are prepaid interest on your mortgage, charged by the lender at the time of closing. Each point is one percent of the loan amount. For example, two points on a $100,000 mortgage is $2,000. By paying discount points you can lower your interest rate. A rule of thumb for a thirty year fixed rate loan is that you will lower your interest rate by 1/8% for each 1/2 point you pay up front. The more points you pay, the lower your interest rate will be, thus lowering your monthly payment. Not sure if you should pay discount points on your mortgage loan?

Q. What is an origination fee? An origination fee is usually 1% of the loan amount and is charged by lenders as an additional source of income. That is why it is important to look at the total cost of loan in terms of acutual dollars to be paid up front and in terms of the APR.

Q. What is APR?

A. APR stands for annual percentage rate and includes all of the up front costs for a mortgage. It is a calculation of what you are actually paying for the loan and makes an excellent way to compare the loans you are being offered by competing lenders. The lowest APR wins.

Q. What are closing costs?

A. Closing costs cover all the charges associated with the transaction, including points, origination fee, appraisal fee, title search fee, title insurance, survey, taxes, deed recording fee, charges for credit reports, etc.