Home Financing Guide

A S u b s i d i a r y o f To w n e B a n k

Buying a home for many people is the biggest and most important investment of their lives.

The process of choosing and obtaining the right mortgage for your unique situation is an important step in assuring that your money is working to your greatest advantage, now and into the future.

We take pride in our ability to work with you to find a practical mortgage solution with terms that meet your needs.

Our commitment to the mortgage industry means we keep informed of the latest developments in housing finance. You’ll have all the best options available to you as we work together to finance your home.

We hope that you will partner with us for a home financing experience that gives you a feeling of confidence and security, so you will get exactly what you need. We are here to help you!

Dear Homebuyer,

Why Should You Finance Your Home With Us?

YOU DEAL WITH ONE PERSONAs your personal loan consultant, we will get to know you and your unique needs. Then, we will tailor a loan product for a perfect financial fit.

ACCESSIBILITY & KNOWLEDGEWe are accessible directly to update you on the status of your loan or to answer any questions you may have.

ALL DECISIONS ARE MADE QUICKLY AND EFFICIENTLYYour loan is kept close at hand, because all decisions are made here.

WE ARE HOME LOAN EXPERTSHome loans are what we do. We have an array of innovative loan products, great rates, and comprehensive local service every step of the way.

CLOSE ON TIMEYour closing date is as important to us as it is to you. Meeting your closing date is our number one priority.

6 Tips For First Time Homebuyers

1. DISCOVER HOW MUCH YOU CAN AFFORD Make sure you are saving enough toward retirement and other goals when deciding how much to spend each month on mortgage payments. Speaking to a mortgage loan officer to get pre-qualified will give you an idea of the price range you should be looking for.

2. REMEMBER THE COSTS OF HOMEOWNERSHIP Remember to plan for homeowners insurance, property taxes, private mortgage insurance, utilities, repairs, and maintenance. Your Loan Officer can give you an estimate of these expenses.

3. RESEARCH NEIGHBORHOODS Prioritize what you are looking for in a neighborhood. Then talk to the people that live in the neighborhoods you are interested in.

4. LISTEN TO YOUR REALTOR® A Realtor’s job is to know how much properties are worth. A well-chosen REALTOR® will do his or her best to help you negotiate on the “home of your dreams”.

5. INSPECT THE HOUSE Hire a full-time, professional home inspector. Again, referrals from friends, relatives, co-workers and your Realtor® are a good place to start.

6. PREPARE FOR CLOSING Closing costs can run in the thousands of dollars and you will want to have enough money to pay for them. Your loan officer can help you through the process.

WE PROVIDE THE RIGHT FIT FOR YOUR HOME FINANCING NEEDS

VA (Veterans Administration)• Up to 100% financing for military veterans, active duty military or eligible reservists• Flexible qualifying guidelines

FHA (Federal Housing Administration)• Not limited to first-time homebuyer• Loan amount limits and property eligibility apply

FHA 203k (Rehabilitation Lending) • Allows repairs on qualified “fixer upper” properties• Cash needed for repairs included in the loan

PHFA (Pennsylvania Housing Finance Agency)• Down Payment assistance of up to $6,000• Programs with 3% down and no mortgage insurance• Combine PHFA with VA/USDA/FHA guidelines• Income limits apply to most programs

USDA (Rural Housing Program)• Not limited to first-time homebuyer• Income limits and property eligibility apply

CONVENTIONAL• Programs with as little as 3% down• Fixed and adjustable rate options• Jumbo financing also offered• Second home and investor loans

Mortgage Options

× Don’t make a major purchase (car, boat, jewelry).× Don’t apply for new credit (even if it says pre-approved).× Don’t open a new credit card.× Don’t transfer any balances from one account to another.× Don’t pay off collections without a discussion with the Loan Officer first.× Don’t buy any furniture or appliances.× Don’t close any credit card accounts.× Don’t change bank accounts.× Don’t deposit any money other than normal paychecks.× Don’t max out or over charge on credit cards accounts.× Don’t consolidate your debt onto 1 or 2 credit cards.× Don’t take out a new loan.× Don’t start any home improvement projects.× Don’t finance any elective medical procedure.× Don’t open a new cell phone account.× Don’t join a new fitness club.× Don’t pay off any loans or credit cards without discussing it with the Loan Officer first.× Don’t change jobs or retire without first discussing with your loan officer.

DO CONTINUE MAKING MORTGAGE OR RENT PAYMENTS

DO STAY CURRENT ON ALL EXISTING ACCOUNTS

DO CONTINUE WORKING AT CURRENT EMPLOYER

DO KEEP THE SAME INSURANCE COMPANY

DO CONTINUE LIVING AT CURRENT RESIDENCE

DO CONTINUE TO USE CREDIT AS NORMAL

DO CALL THE LOAN OFFICER IF YOU HAVE ANY QUESTIONS

DON’T DO

Tips For a Smooth Loan Approval

a

a

a

a

a

a

a

Use this checklist to ensure you have everything together for your loan application. Having all necessary documentation up front saves time so your loan closes smoothly and quickly.

Mortgage Loan Checklist

pAddresses for previous 2 years’ rental or mortgage history

pName, address and phone number of all landlords for past 2 years (if applicable)

pName, address and phone number of employers for past 2 years (include dates and explain gaps)

pAll pay stubs for the most recent 30-day period

pVerification of other income-child support, alimony, retirement, or social security awards letter

pPast 2 years’ signed personal tax returns including all W-2’s

pSelf-Employed- Past two years’ signed personal tax returns, corporate or partnership returns including YTD P/L statements, balance sheets, K-1 and 1099’s

pMost recent 2 months’ statements for all bank, investment and/or retirement accounts (all pages)* *Explain all deposits that are not normal direct deposit payroll

pCopies of separation/divorce decree

pAll bankruptcy papers including discharge and explanation

pSales Contract- legible copy

pValid Driver’s License or Military ID

pVA Loan Applicants- Statement of Service from your Command or copy of your DD-214, Member Copy 4, so we can order your Certificate of Eligibility

pAttorney name and number

pHomeowners insurance info

pCheck or Money Order for Credit Report

REFINANCE

pCopy of Mortgage Statement for each home loan

pCopy of current survey

pCopy of Homeowners Policy (Declaration Page)

pSubordination?

pCopy of deed

pCopy of Title Policy

pDo you have the keys to your new home?

pDo you have access to the garage door opener and/or keypad?

pWhen is the garbage and recycling picked up?

pAny last minute tips about the house- keys, locks etc.

pDo you have all of the booklets and pamphlets for the house and other household items?

pHave you received the sellers’ forwarding address?

pHave you met your new neighbors?

pAre there any annual neighborhood parties or activities you’d like to know about?

pHave you called to change the utilities?

pAre there any invoices or warranties for past work completed?

Ready to move into your new home? Here are a few things to keep in mind:

Make The Move Checklist

Glossary of Mortgage TermsADJUSTABLE RATE MORTGAGE: A mortgage with an interest rate that is periodically adjusted based on the movement of a specified index.

APPRAISAL: A report which evaluates the condition and value of real estate.

CLOSING COSTS: Fees to cover expenses incurred in a real estate or mortgage transaction. Usually include: survey, premiums for title insurance, cost of title examination, attorney fees, recording charges and other customary lender charges.

CONVENTIONAL MORTGAGE: A loan underwritten in accordance with the guidelines established by FNMA, FHLMC or a private investor and insured by a private mortgage insurance company.

ESCROW PAYMENT: The portion of a monthly mortgage payment held by lender to pay taxes and certain types of insurance on the home.

FIXED RATE MORTGAGE: A mortgage with an interest rate that does not change over the life of the loan.

FHA LOAN: A loan insured by the Federal Housing Administration and underwritten to its guidelines.

LOAN-TO-VALUE RATIO: The ratio of the mortgage loan amount to the property’s appraised value or lesser of the purchase price.

MORTGAGE/DEED OF TRUST: A document pledging property as security for payment of a debt.

ORIGINATION FEE: A fee or charge for work involved in the evaluation, preparation, submission and closing of a proposed mortgage.

PITI: Shorthand for principal, interest, taxes and insurance, which are the components of the monthly housing expense.

VA LOAN: A mortgage for an eligible veteran which is guaranteed by the Veterans Administration and underwritten according to its guidelines.

PHFA LOAN: A loan given by the Pennsylvania Housing Finance Agency.

A S u b s i d i a r y o f To w n e B a n k

NMLS# 1054689

I will guide you through the mortgage process each step of the way.

This is being provided for informational purposes only and is not a commitment. Actual loan qualifying is subject to verification and approval of income, credit, property, appraisal and other factors. Rates, fees, and programs are subject to change. *A full or partially funded set aside of proceeds may be required for payment of property charges on the new loan. Home must be occupied as principal residence, required taxes and insurance paid and make all necessary repairs to avoid deterioration of the property. When the house is sold, the loan, along with any interest and fees, are paid to the lender. Any remaining equity belongs to you or your heirs. Advertising materials are not provided or approved by the Department of HUD or FHA.

I will guide you through the mortgage process each step of the way.

Please contact me with any questions you have or assistance

you may need concerning the home buying process.

Deirdre PetrieMortgage Loan Officer

NMLS #141482Direct: 610-763-8976

deirdre.petrie@homesalemortgage.comwww.homesalemortgage.com/deirdrepetrie