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Embarking on the journey of buying a home is exciting and, at times, complex. Whether you’re a first-time homebuyer or a seasoned investor, understanding the nuances of mortgage financing is crucial. Here, you’ll find answers to some of the most frequently asked questions about mortgages.
To qualify for a mortgage with Fidelity Bank, you’ll need to engage with our Mortgage Consultants who are well-versed in guiding you through the process. The bank offers various mortgage programs, including those tailored for first-time homebuyers, and places a strong emphasis on fitting a loan to your financial situation and schedule.Here are some general steps and considerations when qualifying for a mortgage:Credit Score and History: Like most banks, Fidelity Bank will review your credit score and history to determine your loan eligibility and interest rates. A higher credit score generally helps secure a lower interest rate.Income Verification: You will need to provide proof of income through pay stubs, tax returns, and possibly other financial documents to ensure you have the means to make monthly payments.Down Payment: The size of your down payment can affect your loan options and rates. Fidelity Bank offers programs that may allow lower down payments, especially for first-time homebuyers.Employment Verification: Stable employment is crucial, as lenders use this information to predict the likelihood of continued income.Debt-to-Income Ratio (DTI): This ratio measures your total monthly debt payments against your gross monthly income. A lower DTI can make you a more attractive borrower.Personal Assets: Demonstrating additional assets can strengthen your mortgage application by showing you have reserves beyond the down payment.
If you plan to be in your home for more than seven years, you may want to consider a fixed-rate mortgage, which offers predictable payments and long-term protection against rising mortgage interest rates. If you plan to be in your home for seven years or less, an adjustable-rate mortgage (ARM) could be attractive. Keep in mind that with an ARM, your monthly payments have the potential to go up each time your interest rate adjusts.
Your credit score represents your overall credit history. It’s based on information in your credit report, which includes whether you pay your bills on time and the total debt you carry.The way you’ve handled your finances in the past can help predict how you may do so in the future, so lenders will consider your credit score when you apply for a mortgage or other loan. A higher credit score may help you qualify for a better mortgage interest rate, and some lenders may lower their down payment requirement for a new home loan if you have a high credit score.
Refinancing your mortgage may have several potential benefits: It could reduce your monthly principal and interest payment, switch to a fixed rate, eliminate PMI or it could help you pay off your mortgage faster. You’ll want to review any costs associated with the refinancing, as well as the new interest rate of your loan, to determine if a refinance might make sense.
When looking at APR vs. interest rate, at its simplest, the interest rate reflects the current cost of borrowing expressed as a percentage rate. The interest rate does not reflect fees or any other charges you may need to pay for the loan. The APR, also expressed as a percentage rate, provides a more complete picture by taking the interest rate as a starting point and accounting for lender fees and other charges required to finance the mortgage loan.
Fidelity Bank offers a range of mortgage options designed to meet various homebuyer needs, including both standard and specialized loan programs:Fixed-Rate Mortgages – These loans come with a consistent interest rate and monthly payment for the entire term of the loan, available in 10, 15, 20, or 30-year durations.Adjustable-Rate Mortgages (ARMs) – ARMs provide a lower interest rate initially, which then adjusts at a predetermined frequency based on market conditions.Government-backed mortgages – Loans insured or guaranteed by the federal government, making them less risky for lenders and often more accessible for borrowers. Jumbo Loans – For homes that require loans exceeding the typical conforming loan limits, jumbo loans are available to finance larger property investments.Construction Loans – These are suitable for individuals looking to build a new home or undertake significant renovations, offering unique terms like interest-only payments during construction.Each of these programs is designed to cater to different buying situations and financial needs, ensuring there’s likely a suitable option regardless of your home buying plans.For more detailed information or to discuss which mortgage might be best suited to your needs, visiting Fidelity Bank’s mortgage page would be beneficial. You can access more details directly through our Mortgage Programs page.
The amount of down payment you need when applying for a mortgage with Fidelity Bank can vary depending on the type of mortgage program you choose:Conventional Mortgages typically require a down payment of at least 5% of the home’s purchase price. However, if you’re able to put down 20%, you can avoid paying Private Mortgage Insurance (PMI).FHA Loans, which are geared towards first-time homebuyers or those with less available cash for down payments, generally require a minimum down payment of 3.5%.VA and USDA Loans offer options for qualified applicants to finance up to 100% of the home’s value, meaning no down payment is required in some cases.Construction Loans from Fidelity may require as little as 5% down, depending on the specifics of the project and borrower eligibility.These options highlight Fidelity Bank’s flexibility in helping different types of homebuyers access the financing they need, based on their unique financial situations and the property being purchased. For specific details regarding which program might best suit your needs and exact requirements, use our Chat to connect with Fidelity Bank Mortgage Consultant.
During the closing process of purchasing a home with Fidelity Bank, you can expect to go through several key steps:Final Review of Mortgage Terms: Before closing, you’ll have a chance to review the terms of your mortgage. This includes the loan amount, interest rate, repayment schedule, and any other financial details involved in the mortgage agreement.Closing Costs: Be prepared to cover the closing costs, which can include loan origination fees, attorney fees, title searches, title insurance, surveys, taxes, and deed-recording fees. These costs can vary widely but generally range from 2% to 5% of the property’s purchase price.Required Documentation: You’ll need to sign various legal documents, which might include the closing disclosure, mortgage note, mortgage or deed of trust, proof of insurance and the deed. These documents formalize your obligation to repay the mortgage and transfer the ownership of the property to you.Final Walk-through: This is typically done to ensure that the property is in the agreed-upon condition, that necessary repairs were made, and that the house is ready for you to move in.Escrow Account Setup: If your lender is handling your property taxes and homeowner’s insurance, you might need to set up an escrow account at this time. This account will hold funds to pay for these expenses when they are due.The Fidelity Bank Mortgage Consultants, will guide you through each step, ensuring that you understand all aspects of the process and feel comfortable moving forward. We offer a streamlined application process via the Fidelity Bank Mortgage App, which keeps you updated throughout the mortgage process.
For more information or questions, please call us at 1-800-388-4380 or email us at Fidelity@fddbank.com.
