Wisconsin Mortgage Lender
Buying a home can feel daunting but with Society Mortgage, you know you are working with a reputable and professional mortgage lender. Our loan officers are experienced, friendly, and happy to explain the different types of rates and loan options and their respective lengths. We are here to answer all your questions and make you feel you have a mortgage lender you can trust with your financial planning.
Here’s a guide to the major types of rates and loans, loan terms, and the basics of mortgages.
Basics About Mortgages
A mortgage is a loan used to purchase a housing opportunity, where the property itself serves as collateral. The borrower agrees to repay the loan over a specified period, typically 15 to 30 years, through monthly payments that include both principal and interest.
The mortgage process involves several key steps:
Pre-Approval
Before shopping for a home you should get pre-approved for a mortgage. Credit approval gives you a clear idea of your budget and makes you a more attractive buyer to sellers. Pre-approval tells you how much home you can buy in Wisconsin.
Application
Once you’ve found a home, you’ll complete a mortgage application and provide the necessary documentation, including proof of income, employment, and line of credit history. Your lender wants to confirm you have the income to repay the loan they are giving you.
Processing and Underwriting
The loan officer will verify your personal information and assess your creditworthiness. An appraisal of the property tells the lender about the value of the home you plan on buying. Your lender wants to confirm that the money they are lending you matches the value of your Wisconsin home.
Closing
If your home loan is approved, you’ll attend a closing meeting to sign the final documents. At this point, you’ll pay any closing costs and the loan funds will be disbursed.
Repayment
You’ll begin making monthly mortgage payments, which include principal, interest, taxes, and insurance (often abbreviated as PITI).
Major Types of Loans
Conventional Loans
Conventional loans are not insured or guaranteed by the federal government. These loan programs often require a higher credit score and a larger down payment compared to government-backed loans but offer more flexibility in terms of loan terms and interest rates.
FHA Loans
Insured by the Federal Housing Administration (FHA), these home loans are designed for low-to-moderate-income borrowers who may have lower credit scores. FHA loans require a lower down payment, which makes them a great option if you are a first-time homebuyer.
FHA 203(k) Loans
FHA 203(k) loans can turn a fixer-upper into a dream home. They let homeowners finance both the purchase (or refinancing) of a house and the cost of its rehabilitation through a single mortgage. This makes them an excellent option for homebuyers and homeowners looking to invest in properties that need significant repairs.
VA Loans
Available to eligible veterans, active-duty service members, and certain members of the National Guard and Reserves, VA loans are guaranteed by the Department of Veterans Affairs. These loans often require no down payment and come with competitive interest rates.
USDA Loans
Backed by the U.S. Department of Agriculture, USDA loans are designed for rural and suburban homebuyers who meet specific income requirements. These loans often require no down payment and provide favorable terms for eligible borrowers.
Jumbo Loans
If you want financing above the conforming loan limits set by Fannie Mae and Freddie Mac, jumbo loans are the right choice. These loans are ideal for purchasing high-value properties in Wisconsin but typically require a higher credit score and a larger down payment.
Adjustable and Fixed Interest Rates
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Fixed-Rate Mortgages
A fixed-rate mortgage offers a stable interest rate for the entire loan term. You know beforehand how much your monthly payments will be for the length of the loan. This type of loan is ideal for borrowers who plan to stay in their home for a long time and prefer the predictability and consistency of a fixed payment.
Adjustable-Rate Mortgages (ARMs)
An ARM has an interest rate that can change periodically based on market conditions. ARMs offer a lower initial interest rate compared to fixed-rate mortgages. This comes in handy if you plan to sell or refinance your Wisconsin home before the adjustment period begins.
Common ARM terms include 5/1, 7/1, and 10/1, where the first number indicates the fixed-rate period in years and the second number indicates how often the rate adjusts after that period.
Length of Loan
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15-Year Mortgages
A 15-year mortgage allows borrowers to pay off their real estate loans faster and save significantly on interest payments. However, monthly payments are higher compared to longer-term loans.
30-Year Mortgages
If you want to ease the pressure on your monthly budget, you can apply for a 30-year mortgage, which is the most common loan term. Monthly payments are lower as they spread over 30 years. This option makes homeownership more affordable on a monthly basis but also means that you will pay more in total interest payments over the life of the loan.
As your Wisconsin mortgage lender, we are dedicated to helping you find a loan that matches your needs. Contact us today to start your journey toward homeownership!
Society Mortgage for your Wisconsin home
If you are in Wisconsin and want to buy a home or invest in a new business property, our mortgage loan company is happy to help you find a loan to make homeownership come true. We are a professional and experienced mortgage company and our customer service team is always available to help with any queries throughout the process. We always work with equal housing opportunity in mind to make sure we are providing our clients with the best homeownership deals.
Whether you’re buying your first home in Wisconsin, refinancing an existing mortgage, or looking for investment property financing, we are here for you, every step of the process. Our goal is to provide you with the best mortgage options to match your needs.
Choose Society Mortgage for your Wisconsin home and experience the difference of working with dedicated and reliable mortgage brokers. Get in touch with us today, meet our team, and let us help you find your dream house. Your journey to homeownership starts here!