The Buying Process | Finances
Finance You New Home with HomeBridge
Suarez Housing is proud to work with HomeBridge, to ensure that you find home financing that’s right for you.
Because your home is one of your biggest investments, it’s important to ensure that your mortgage fits your needs. That’s our specialty – finding mortgage solutions that meet your current situation while complementing your long-term financial goals.
Our goal is to help you determine what mortgage options work best for you, guide you through the loan process, and answer your questions.
About Greg Walker
Greg Walker has been in the mortgage business since 1992. He has helped thousands of families in Tampa Bay realize home ownership. He makes the loan process easy by meeting with customers face-to-face and setting the proper expectations upfront.
He holds a BA and MBA from Saint Leo University and has extensive knowledge in all types of mortgage financing. He is an expert in FHA, VA, Conventional, Jumbo and Construction/Perm mortgages.
Greg has won numerous awards in the industry including Chairman’s Circle, Presidents Club and Newcomer of the Year Award for loan production. He has consistently been recognized as a top producer in the Tampa Bay area for nearly two decades.
Greg Walker, Branch Manager
NMLS # 391361
Please Note: All first mortgage products are offered and provided by HomeBridge and may not be available in your area.
Jennifer Martinez, Sales Manager
C: (813) 480-4747
F: (813) 856-4555
Buying a home is part of the American dream. It is a significant long-term investment that often represents the foundation of our lives, providing financial and emotional security. It is also the largest single transaction most people ever make. That is why it is so important to choose a home and a mortgage that arewell suited to your needs.
What Is A Mortgage?
A mortgage is a loan secured by real estate. In other words, in return for the funds necessary to purchase a home, a lender gets your promise to pay back the funds over a certain period at a certain cost. Backing your promise to repay is the property. Should you default, or stop paying the loan, the lender would take over ownership of that property. Typically, the repayment of a mortgage occurs through monthly payments.
What Does My Mortgage Payment Include?
Usually, your monthly mortgage payment is made up of four parts: principal, interest, taxes and insurance (PITI), but it can also include maintenance expenses, such as condominium homeowners’ association dues. The principal is the amount in your monthly payment that reduces the original amount borrowed. Over the life of a standard mortgage loan, the entire original amount borrowed is generally scheduled to be fully paid off, or amortized. The interest rate is the fee charged to borrow the outstanding balance for the past month. In addition, a monthly amount may be collected and held in a separate escrow account to cover property taxes, homeowner’s insurance and mortgage insurance. Your lender uses the money in the escrow account to pay your tax and insurance bills, as they come due.
Mortgage Payment Breakdown
Principal + Interest + Taxes + Insurance = PITI
Although each individual home financing package has its own variety of features, the concept of a mortgage is really quite simple: a mortgage is a loan made to help you finance a home. Your lender advances you a certain amount of money, which you repay over a specified period.
Rates, Points And Loan Fees
The total cost of your mortgage is determined by a number of different factors, most notably the interest rate, discount points, and loan fees.
- Interest rate refers to the percentage of your outstanding loan balance that you pay the lender each month as part of the cost of borrowing money. Your interest rate will be based on the current overall rate environment, as well as your financial profile and the specific features of your loan.
- Discount points allow you to “buy down” your interest rate at closing. One point equals 1% of your loan amount, and the more points you pay, the lower your interest rate will be, and the less you will have to pay each month. If you wanted to lower your closing expenses, you could also accept a slightly higher rate and pay no points.
- Loan fees are up-front charges to cover the cost of originating, processing, and closing your loan, among other things. An origination point is a loan fee that equals 1% of your loan amount.
When considering loan pricing, keep in mind that rates, points and fees should be considered together. The interest rate alone only tells part of the story. The expenses that contribute to the cost of your loan can be expressed as the annual percentage rate (APR).
Your Monthly Mortgage Payment
Mortgage payments can generally be divided into four parts: principal, interest, taxes, and insurance. These are often referred to with the acronym PITI.
- Principal refers to the amount of money you borrow to buy a home, and to the outstanding loan balance at any point during the mortgage term.
- Interest is the cost of borrowing money. As noted above, the amount of interest you pay each month is determined by your interest rate.
- Taxes assessed by your local government will likely be collected by your lender as part of your monthly payments, and then paid annually or semi-annually on your behalf. This process is known as an escrow.
- Insurance, like property taxes, is normally collected by the lender in an escrow account. Insurance offers financial protection, and has two major components:
- Homeowner’s insurance, also called hazard insurance, protects you against damage to your property caused by fire, wind, or other hazards.
- Mortgage insurance protects your lender in the event that you fail to repay your mortgage. Whether you must pay mortgage insurance usually depends on the loan program and the size of your down payment.
Note that the loan’s APR doesn’t figure into the calculation of the monthly payment. The APR reflects all the costs of your mortgage, including not only the quoted interest rate (used to calculate the principal and interest) but also