About the Expert
Tami LaCoe Channel has been in the mortgage business since 2002, working as a loan officer, holding various management positions, and opening C&T Mortgage alongside her best friend and business partner, Carrie Panacek in 2007. Together, with their team, they have closed thousands of loans over the years. They know what a client needs from a mortgage lender.
Why should I use a local lender?
Using a local lender is a much better way for people to go. You’re treated like an actual person, not just a number. Typically, you see better rates and fees with local lenders because everything is done in-house, closing you much faster. Every loan and client are different, so we can tailor a loan that is specific to the client.
What are the different loan options available?
There are two types of loans: government and conventional. Government loans end in “a” — USDA, FHA, and VA. Conventional loans are bank loans. Government loans require putting little if anything down. USDA and VA loans are good for rural properties or veterans. FHA loans are good for first-time homebuyers with good credit, who need a little more help with closing costs.
Conventional loans are better for people with great credit and more money down. However, you can get into a conventional loan with as little as 3% down if you are a first-time home buyer. You are considered a first-time homebuyer if you have not owned a home in the last three years.
What length should my loan be?
Interest rates are based on $250,000 loans. The higher your loan amount, the lower your interest rates will be and vice versa. When people see interest rates online, they think that’s the going rate for every home. Those are usually based on clients with 20% down, 740 credit scores, points, and buyer purchase incentives.
There are different fixed rates — 10 years all the way up to 30 years. You will see lower rates for the shorter terms and higher rates for the longer terms. The most aggressively priced rates are for the 15-year and 30-year fixed, as those have been around the longest.
What information do I need when applying for a purchase loan?
Everybody will need valid IDs, two months of bank statements, and two years of income documents. Assets, income, and IDs are the most important items. Clients who do not want to provide full bank statements or feel what is being asked is intrusive need to remember they are requesting a bank to lend them money. Be prepared to show or get your loan officer what they request because it is per Freddie Mac/Fannie Mae guidelines.
When is the right time to refinance?
Right now is a good time to refinance because interest rates are low. You might want to get out of mortgage insurance, move from a 30-year to a 15-year loan, convert your FHA to a conventional loan, pull cash out, and more. It’s always best to call a local lender and let them review your loan to see if it is beneficial. It is a big misconception that you need to save at least 1% to refinance. That is not always the case, as there are so many variables regarding refinances, and every situation and loan is different.