FAQs - Frequently Asked Mortgage Questions
Asking questions is a great place to begin! Find the answers to our most frequently asked mortgage questions below by clicking or tapping on the questions in the categories below. Remember that our team is here to answer any questions you have from the time you start your mortgage application, to closing day, and beyond.
Aspire Lending usually closes loans between 3-6 weeks after rate lock. There are a number of steps in the loan process and staying in communication with your mortgage consultant can play an important role in keeping the timing of your loan on track.
Read more about how long it takes to refinance your mortgage...
A loan term is the length of time given to pay back the loan in monthly structured payments. Mortgages usually have terms of 30, 25, 20, 15, or 10 years depending on what payment best fits your needs. A 30 year mortgage term is the most common, but many home owners choose to refinance to a 15 year mortgage term for the overall cost savings.
Speaking to a licensed Aspire Lending mortgage consultant about your goals is the best way to learn about your mortgage options. However, before you call you can check to make sure that you meet some of the qualification guidelines for a conventional mortgage. For example, you need a minimum 620 FICO credit score and 3% to 5% down payment savings.
After reviewing your initial loan estimate, you can lock in your quoted interest rate by speaking with your Aspire Lending mortgage consultant. After your rate is “locked-in” your rate is guaranteed to not go up for a 35 day lock period.
A licensed appraiser provides an assessment of the fair market value of the property and provides a detailed report to the mortgage company. Appraisals are required for all purchase loans and many refinance loan programs.
Having a current appraisal protects both the borrower and lender in a real estate transaction by confirming the value of the property.
Equity, simply put, is the difference between the value of your home and the amount owed on the loan. An appraisal can determine the fair market value of your home, so that you can calculate the amount of equity you hold.
To qualify for a conventional mortgage you should have a 620 FICO credit score. This is the minimum required credit score required, but it is a good idea to set a higher goal for your credit.
Read more about your credit score and mortgage qualification...
The minimum down payment on a home can range from 0% to 5% of the total purchase price of the home. These are the minimum down payment requirements for different loan programs.
- Conventional Mortgage: 5% down payment
- FHA Mortgage: 3.5% down payment
- First Time Home Buyer Conventional Mortgage: 3% down payment
- USDA Mortgage: 0% down payment
- VA Mortgage: 0% down payment
Improving your credit score can involve a number of variables that are unique to your personal credit history. These are a few basic steps to building stronger credit history and improving your score.
Utilize different types of credit:
- Make all payments on time.
- Pay down revolving credit lines to below 30% of the credit limit.
- Don’t close older credit accounts, even if you aren’t using them.
- Avoid co-signing on loan or lease agreements for other people if possible.
- Budget your spending so that you don’t over extend your credit.
Read about improving your credit score before buying a home...
There is no minimum income amount required to qualify for a mortgage. However, your monthly income is a part of the calculation of how much of a mortgage payment you can afford. Your debt to income ratio determines the loan amount you can potentially qualify for.
Yes, potential home buyers can qualify for a mortgage when they have student loans.
However, If your student loan payments take up a significant portion of your monthly income, it can impact the total loan amount you qualify for.
If you have met the required waiting period after a bankruptcy, foreclosure, or short sale then you can potentially qualify for a mortgage.
You will need to speak with one of our licensed mortgage consultants about your specific home buying goals and complete a pre-approval application.
Once your pre-approval application has been reviewed and approved by an underwriter (usually in less than 48 hours) your Mortgage consultant can provide you with an official pre-approval letter for the approved loan amount.
Getting pre qualified takes just a few minutes of speaking with one of our licensed mortgage consultants to assess your financial outlook and goals. Remember that getting pre approval requires a few more steps than pre qualification.
A full pre approval with a preliminary review of your income documents from an underwriter can take as little as 24 to 48 hours. This of course depends on how quickly you submit the required documentation.
It’s FREE to get a full pre-approval with Aspire Lending. We do not charge upfront fees or application fees to get pre-approved like some other lenders.
When you apply for pre approval be prepared to show documentation that confirms your stated income and down payment savings.
- 2 years of W-2 or 1099 forms
- Current bank statement(s)
- Employment verification
If you are simply talking to a mortgage consultant about your goals of buying a home to gain and understanding of what mortgage options you would be pre qualified for, then a soft credit pull would be needed. Soft credit pulls do not impact your credit.
However, if you are looking to be fully pre approved with a pre approval letter for making offers, then a hard credit pull and a preliminary underwriting review is required. A hard credit pull will show on your credit. Having several hard credit pulls can impact your credit score, so limit the number of hard pulls to your credit when applying for a mortgage.
Learn more about how shopping for mortgages can impact you r credit score...
In community property states, your assets and debts are shared with your lawful spouse. While you can choose to include or exclude your spouse on the mortgage application for income or credit purposes, your spouse’s debt must be calculated in your mortgage qualification. Your spouse’s name will also be included on the title of the property, whether or not they are on the mortgage loan.
For these reasons, it is also a good idea to not change your marital status during the mortgage process.
We offer these conventional and federally backed residential mortgage loans listed below.
Home Purchase Loans:
- Conventional Mortgage
- FHA Mortgage
- USDA Mortgage
- VA Mortgage
- Jumbo Mortgage
Yes, Aspire Lending does offer FHA home loans. These are loans that are backed by the Federal Housing Administration, and have a number of benefits for American home buyers.
Yes, Aspire Lending does offer VA home loans to qualifying members of the U.S. armed forces.
Yes, Aspire Lending does offer USDA home loans on qualifying USDA rural properties. This mortgage program is federally backed by the United States Department of Agriculture and is intended to boost economic stability in rural and other underdeveloped areas.
Aspire Lending does not currently partner with any down payment assistance programs. However, we do have several low down payment mortgage options that make home ownership accessible and affordable to more potential home buyers.
A rate and term refinance is the term used to describe a conventional mortgage refinance loan with the purpose of adjusting the interest rate and loan term of the primary mortgage lien.
A “Cash-Out” mortgage is a refinance of the primary mortgage lien that allows the homeowner to borrow equity from their home, up to 80% of the appraised value.
Yes, Aspire Lending does offer a VA IRRRL option. The VA Interest Rate Reduction Refinance Loan is a streamlined process for veterans to refinance their current VA loan to a lower interest rate.
Yes, Aspire Lending does offer a FHA streamline refinance loan option. Homeowners with a current FHA mortgage loan can refinance to a lower interest rate with a streamlined process.
Yes, Aspire Lending has a mortgage option that allows homeowners to access their home equity.
Mortgage interest rates change every day, and some times a few times during the day. We can post a few interest rate scenarios on our website to give you an idea of the current interest rates available.
However, the best way to know what your potential interest rate is for your specific mortgage needs, is to call and speak with one of our licensed loan experts.
The best way to get a quote on your potential mortgage interest rate, is to speak with one of our licensed mortgage consultants. Once they have an understanding of your specific mortgage goals, they can provide you with a loan estimate that will show you your best mortgage options.
There are several key factors that affect your mortgage rate such as: your credit score, location of the property, loan to value, amount of your down payment, the term of your loan and the type of loan. A licensed mortgage consultant can help customize the best loan available that fits your specific needs.
If the market conditions are favorable you may be able to get a lower interest rate on your current mortgage by refinancing.
Building your credit score to a 740 or higher will help you qualify for the best rate pricing during your loan application. You may also consider paying points at closing to get a lower interest rate. Speak with your licensed mortgage consultant about the available interest rate options during the loan process.
At a 740 FICO score or higher, you would have access to the best available interest rates on the market.
Interest can be thought of as the cost of borrowing money. When you are selecting your interest rate on your mortgage, you can potentially pay “points” at closing that will reduce the interest rate during the mortgage term. “Credits” can offered to you as a discount on closing costs if you select an interest rate that is higher than the “par” rate.
Ask your mortgage consultant about the points or credit options available on your mortgage.
The loan amount you qualify for on a mortgage depends on a few financial factors. Speaking with one of our licensed mortgage consultants about your income, current debts, and down payment savings is the first step in learning how much home you can afford.
The minimum down payment on a home can range from 0% to 5% of the total purchase price of the home. These are the minimum down payment requirements for different loan programs:
- Conventional Mortgage: 5% down payment
- FHA Mortgage: 3.5% down payment
- First Time Home Buyer Conventional Mortgage: 3% down payment
- USDA Mortgage: 0% down payment
- VA Mortgage: 0% down payment
There are a few front costs of buying a home that you should be prepared for, before you start shopping. The cost of the home appraisal and optional home inspection are out of pocket expenses. You should also save for the down payment and closing costs associated with getting a mortgage.
Consider saving extra for the costs of moving, deep cleaning, security measures, furniture and/or appliances. It can make the transition to your new home easier when these costs are considered in advance.
Home inspections are not required as a part of the mortgage process, but they can be very helpful to you as a home buyer. A certified home inspector takes a deep look at the functioning aspects of the home and will identify any potential repairs, damages, or areas of concern before you commit to buying the home.
Making large purchases during the mortgage process is not a good idea, as it can potentially impact your loan qualification.
If you buy furniture, appliances, or other large ticket items on credit during the mortgage process the impact on your credit score or debt to income ratio can delay or prevent your loan from closing. It’s best to wait until after your loan has closed and funded to buy those things.
Learn more about the “Do’s and Don’ts” of the Mortgage Process...
Once you hold at least 20% equity of your home’s value there are a few ways to drop mortgage insurance from your loan.
Conventional loan programs allow your current loan servicer to drop mortgage insurance automatically when your loan reaches 80% loan to value of lower. FHA and USDA loans that come with lifetime mortgage insurance, will need to be refinanced to a conventional loan program to drop the mortgage insurance.
Your mortgage payment is applied to paying back the principal balance of the loan, the interest, and the monthly contribution to the escrow account.
Use our mortgage payment calculators to see your estimated monthly mortgage payment:
The principle and interest portion of your fixed mortgage payment will remain the same for the entire term of the repayment period. The escrow portion of your payment can change as the local property taxes or homeowners insurance costs change.
An escrow account is built into the structure of your mortgage payment and holds the estimated amount due for your property taxes and homeowner’s insurance. The financial institution servicing your mortgage should coordinate the payment of your taxes and insurance on your behalf when they are due.
Escrow accounts are required on all government backed mortgages including FHA, USDA, and VA loans. Escrow accounts are not required for conventional mortgages that have more than 20% equity in the loan to value ratio.
There are advantages to having an escrow account as a part of your mortgage. A large majority of home owners keep the escrow account as a part of their mortgage structure, but a few choose to waive escrow.
A loan estimate containing the details of your loan will be sent to you shortly after completing an application with one of our licensed mortgage consultants. The loan estimate will show the estimated terms, interest rate, closing costs, and all financial aspects pertaining to your specific loan.
We encourage you to ask your mortgage consultant any questions you may have about your loan estimate.
A typical mortgage appraisal costs $400 to $600.
The price of an appraisal can be higher for some types of properties. If the home is in a remote rural location, has unusual or exceptional features that need additional consideration, or is unique enough to make finding comparable homes difficult.
Closing costs vary based on the type of mortgage you choose, the loan amount, the location of the home, and some other potential variables. Generally closing costs are about 2% - 5% of the loan amount.
You will see a detailed estimate of your closing costs in the initial loan disclosure.
Closing costs and your down payment are paid at the scheduled time of your closing.
Mortgage insurance is a required part of a mortgage payment on some types of loans with a loan to value ratio that is under 80%. A PMI policy will protect the lender in the event of a loan default.
You can potentially drop the added cost of mortgage insurance from your loan after some time.
Aspire Lending does consistently offer some of the lowest rates available on the market. Our company is focused on navigating the mortgage process with efficiency, so that we can pass the savings onto our customers.
You are always welcome to shop around for the mortgage company that best fits your needs. Time and time again our customers tell us that we have the lowest interest rates, which saves you money.
Aspire Lending is a mortgage lender.
We are licensed for mortgage lending in these states:
Aspire Financial, Inc. Mortgage Licensing System NMLS ID# 137773
- Alabama Consumer Credit License 22879
- Arkansas Combination Mortgage Banker-Broker-Servicer License 103833
- Florida Mortgage Lender License MLD413
- Florida Mortgage Lender Servicer License MLD2011
- Georgia Mortgage Lender License/Registration NMLS#137773
- Louisiana Residential Mortgage Lending License
- New Mexico Mortgage Loan Company License
- Oklahoma Mortgage Lender License – Other Trade Name #1 ML010044
- Tennessee Mortgage License 112820
- Texas – SML Mortgage Banker Registration
- Texas – SML Residential Mortgage Loan Servicer Registration
- Texas – Click here for the Texas Complaint/Recovery Fund Notice.
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