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Purchase USDA

One hundred percent financing makes these loans among the most desirable of loan programs still in existence. Even better than just no down payment, the possibility of rolling in closing costs or use grants and gift funds, something most other programs won’t allow borrowers to do.

  • Purchased for:

    $180,740

    Click here to read loan terms

    Loan (Principal & Interest): $ 879.42

    Homeowner’s Insurance: $ 65.34

    Property Taxes: $ 330.75

    Mortgage Insurance: $ 76.23

    Total Monthly Payment: $ 1,351.74

The above detailed loan information belongs to a real loan transaction closed thru Clear Lending. Loan terms are disclosed and available under Loan Terms banner.

Loan Scenario Blog

6 Pieces of Information Key for a Home Loan Application

August 25, 2019

Are you a first-time homebuyer and getting ready to apply for a mortgage loan? If this is your case, you will have to provide your lender with personal financial information as well as information about the house you want to finan...MORE.

Are you a first-time homebuyer and getting ready to apply for a mortgage loan? If this is your case, you will have to provide your lender with personal financial information as well as information about the house you want to finance.

By now you have probably heard from family, friends or simply reading online to request a Loan Estimate from three or more lenders. But are you familiar with what step needs to take place in order to receive a Loan Estimate? Even if you just want information, to request a Loan Estimate you must complete an application.

To complete an application, you will need to submit the following six key pieces of information:

  • Your name (copy of a US picture ID such as your driver license or passport)
  • Your income (last month of paystubs plus last 2 years of taxes and W-2s or 1099s)
  • Your Social Security number (so the lender can check your credit)
  • The address of the home you plan to purchase or refinance (a specific house address will be needed)
  • An estimate of the home's value (loan officer can guide you but the lender will need either purchase price or estimated value if house loan is refinanced)
  • The loan amount you want to borrow (typically this would be the maximum loan amount allowed per loan program guidelines to be financed after deducting down payment or simply loan amount desired if house loan is refinanced).
 

Keep in mind although you're not required to provide documents to the lender in order to get a Loan Estimate, it's a good idea to provide them as the more information the lender has the more accurate your Loan Estimate will be. If you decide not to provide documents keep in mind loan programs have many additional guidelines which may disqualify you from loan approval. Therefore is always a good idea to provide documents to confirm your Loan Approval.

Each lender is required to send you a Loan Estimate within three business days of receiving your six key pieces of information.

Once you're ready to choose a loan offer, you need to notify the lender that you are ready to proceed with the loan application and complete the intent to proceed. If you don't notify a lender that you'd like to proceed within 10 business days, the lender may revise the Loan Estimate or close your application as incomplete and you may need to start over. The 10 business days are calculated from when the lender delivers the Loan Estimate to you or places it in the mail, whichever is earlier.

Once you've notified the lender that you would like to proceed with an application, the lender may ask you to provide additional information and documents to verify the information you have already submitted. The lender processes this information and may follow up with you to request additional information or clarification. Once the lender has received all the necessary information, the lender approves or denies your loan application.

The Loan Application process can be complicated and difficult or a simple and easy one. This will always depend on the applicant’s decision on how to proceed. The best way is to research your options and once an experienced loan officer offering most value is found work hand by hand from application to closing.

Home Loan Closing Costs: What You Should Know

December 5, 2018

Purchasing a home and trying to figure out what home loan closing costs to expect? Next I will be discussing closing costs. What exactly is closing cost, you might ask? Closing costs are basically expenses incurred in the proce...MORE.

Purchasing a home and trying to figure out what home loan closing costs to expect? Next I will be discussing closing costs.

What exactly is closing cost, you might ask? Closing costs are basically expenses incurred in the process of completing the home purchase transaction which are over and above the purchase price of the property and which you are planning to buy. These closing costs slightly differ from loan to loan and though initially may not seem like such a big deal considering that you are purchasing a property that’s worth many times over closing costs can actually add up to thousands of dollars! 

Before I go in detail with some of the most typical closing costs seen on most of home loan programs, I invite you to watch this video from the Consumer Financial Protection Bureau in regards Home Loan Closing Costs.

Let’s go over typical home loans closing costs generally seen in all loans:

• Loan origination fee - An origination fee is an upfront fee charged by a lender for processing a new loan application, used as compensation for putting the loan in place generally between 0.5 and 1% on mortgage loans.
• Transaction Fee - The fee the lender and any mortgage broker charges the borrower for making the mortgage loan
• Warehouse Fee - A charge to a borrower when a mortgage banker or other small lender must borrow money on a short-term basis in order to loan money on mortgage loans.
• Document Review Fee – A fee paid to bank’s attorneys prior to loan closing to review legal documents related to the settlement of a property.
• Discount Points Fee - Prepaid interest on the mortgage loan. The more points you pay, the lower the interest rate on the loan and vice versa. Borrowers typically can pay anywhere from zero to two points, depending on how much they want to lower their rates. This kind of point is tax-deductible.
• Appraisal Fee – A fee which covers the cost of having a professional appraiser evaluate a home and estimate the market value of the home. The cost is often around $400 to $600 in most markets, but unique properties and remote homes can cost more to appraise.
• Credit Report Fee - A fee to pay a detailed report of an individual's credit history which lender will need to determine loan applicants' credit worthiness.
• Tax Service Fee - A fee paid to a tax service agency to look for delinquent property taxes and alert the mortgage company to prevent tax liens from existing against their mortgagors' homes. Since tax liens have priority over lender liens, banks want to ensure that they, not the state, become the owner of these properties before closing transaction.
• Flood Certification Fee - A fee that must be paid for an assessment to determine whether the property resides in a flood zone. When a residential home is found to lie within a flood zone, flood insurance is required before closing the sale.
• Document Preparation Fee - A fee that attorneys and/or settlement agents charge for the preparation of the necessary closing documents.
• Contract Processing Fee - A charge for obtaining and coordinating documentation, appraisals, employment and credit history, or any other information necessary for the lender's underwriting department and final approval.
• Lender’s Title Insurance Fee - Title insurance is an insurance policy that covers the loss of ownership interest in a property due to legal defects and is required if the property is under mortgage. The most common type of title insurance is a lender's title insurance, which is paid for by the borrower but protects only the lender.
• Title - Settlement/Escrow Fee - This fee is paid to the settlement agent or escrow holder. Responsibility for payment of this fee can be negotiated between the seller and the buyer.
• Title - Tax Certificate Fee - Fee paid to a title company to determine the status of property taxes on the property. 
• Survey Fee – Fee paid to a surveyor to measure the metes and bounds of the property that you're actually buying. He'll draw a nice map of the property, showing the property line, the improvements on the property, any fences or shrubs, and any easements on record.
• Mortgage Recording Charge Fee - Fees paid to the county for recording the deed of trust and the warranty deed.
• Owner title policy - Insurance policy that covers the loss of ownership interest in a property due to legal defects which is required if the property is under mortgage.
• Underwriting fee – Fee to cover the cost of evaluating your total loan application package, including your credit report, employment history, financial documents and appraisal to complete risk assessment and thus its final approval.
• VA Funding Fee – A fee paid by a buyer or seller to insure the lender against loss through default on a VA loan.
• Upfront Mortgage Insurance Premium – MIP – A price paid by the borrower to insure the lender against loss through default with FHA loans.
• Home inspection - An examination of a real estate property's condition, usually performed in connection with the property's sale. A qualified home inspector can assess the condition of a property's roof, foundation, heating and cooling systems, plumbing, electrical work, water and sewage, and some fire and safety issues.

These are some of the most common type of closing costs. For more information on closing costs or further clarification on any matter related to mortgage loans please contact me here.

What will the Loan Estimate Tell Me?

November 11, 2018

Next we will address key information included in a Loan Estimate which is the document that talks about typical closing costs included in a mortgage home loan....MORE.

Next we will address key information included in a Loan Estimate which is the document that talks about typical closing costs included in a mortgage home loan.

Down Payment Dilemma: How much down makes most sense?

October 6, 2018

As the purchase of your home gets closer, I am pretty sure your main strategy and action plan is based on how much down payment you are willing & able to give at closing.  First time home buyers first though is always ...MORE.

As the purchase of your home gets closer, I am pretty sure your main strategy and action plan is based on how much down payment you are willing & able to give at closing. 

First time home buyers first though is always the bigger the down payment the lower my monthly payment will be. And while this is true the question is whether the time it takes to save such large down payment while renting compared to its monthly savings makes most sense or not. Before getting into detail with a scenario I invite you to watch video in this section about how down payment affects your overall loan.

In my 20+ year of experience doing loans, however, I have seen how many clients’ strategies lack financial common sense. To illustrate this, consider the following real example of a property listed for sale in Houston, Harris County with 4 bedrooms & 2.5 bathrooms, 2550 sq. ft. built on 2006 which typically would rent at least for $1,600/month:

Sales Price - $180,000
Down payment - 3.5% or $6,300
Credit Score - 680 credit
FHA Interest Rate - 3.875%
Loan Monthly Payment - $831.09
Mortgage Insurance - $123.04/month
Taxes 2016 - $4,565/year or $380.42/month
Insurance estimated - $1,435/year or $119.59/month
Total monthly payment - $1,454.14

Then some clients prefer to wait 2 years to save that 20% or $36,000 renting at $1,600/month or $38,400 for 2 years’ worth of rent. Then after 2 years and once that 20% is saved the following numbers apply:

Sales Price - $197,000 (Based on Houston market trends same house went up $17,000 after 2 years)
Down payment - 20% or $39,400
Credit Score - 680 credit
Conventional Interest Rate – 4.25%
Loan Monthly Payment - $775.30
Mortgage Insurance - $0,00/month
Taxes 2016 - $4,565/year or $380.42/month
Insurance estimated - $1,435/year or $119.59/month
Total monthly payment - $1,275.31

Total savings after waiting 2 years to save $39,400 = $178.83/month. Does it make sense to wait 2 years to save for down payment? Probably not. Feel free to contact me to go over any scenario you were thinking of and would like to run to me for consideration contacting me here.

How Much Home Can You Afford?

Let us know your desired monthly payment (including insurance/taxes), zip code you prefer to live
and estimated credit score and we will estimate the max purchase price you should be looking for

Take the first step...

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Customers Reviews:

  • Michael Estrada •

    Joan with Clear Lending is direct, honest and very helpful. We were very lucky to have him. He is very easy to communicate with. He gives you a clear view of your loan situation and then he helps and guides you in each and every step. Ours was not an easy transaction but he was there guiding us the whole time. We got our loan but even if it didn't go our way, I would gladly use him again and very proudly recommend him to anyone.

  • Jerald Sidney •

    Joan, you are the man with miracle hands! I have really been enjoying my new home. It was a long time coming and it happened right on time. Thanks to you, this whole process was phenomenal. The closing went smooth with no problems. I appreciate the professionalism, the hard work, and the late hours. I would highly recommend your services. Again, thank for everything!

  • Roy & Denita Hawkins •

    Joan and Clear Lending were a blessing for our family! Prior to working with Joan, I ran into one brick wall after another with financial institutions that simply judged me based on a "credit score" without taking into account any contributing factors beyond my control. Fortunately for us, we met Joan. He was able to do something that up until that point seemed impossible...approval for a home purchase! He worked long hours and showed great patience. We have been in our new home purchase a little over two months and we owe Joan a great deal of credit. I recommend anyone who is interested in purchasing a home to give Joan a call before you give up. If it can be done he is the guy to make it happen! I have already referred a family member and they are excited. Thanks, Joan!

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