CLOSE MENU
Back to Menu

Tools & Resources

Tools and Resources

Whether you’re looking to buy your first home, buy again or refinance your mortgage, our online calculator and articles can provide you with a general idea of what to expect. Get a sense of the buying timeline, learn about your financing options to see which works best for you, and much more.

Calculators

Learn how much you can afford, estimate payments and compare your options with our useful mortgage tools.

Articles

Get helpful information on a broad range of mortgage topics and be better educated when it comes to mortgages, refinancing and related financial decisions.

Loan Options

It’s important to understand the financing options for your new home or property. Become educated on the various mortgage products available to suit your financial situation.

FAQs

Get answers to some of the most frequently asked questions about home mortgages and refinancing options from PHH Mortgage.

Calculators

 

Monthly Payment

Your monthly mortgage payment is calculated by adding the costs of the loan’s principal and interest, as well as any money held in escrow for taxes and insurance. How much will it be? Get an idea now and compare different loan terms.

Rent vs. Buy

If you rent your home now and are considering buying, determine if it makes financial sense with our rent vs. buy calculator. Enter in details about your current monthly rent and the home you’d like to buy and find out which option makes sense for you.

Refinance

Find out if now is a good time for you to refinance. Simply enter some information on your current loan, plus the new loan you're considering, and we'll calculate your potential savings.

Amortization

Curious to see how much principal and interest you will pay over the life of your loan? Input your information into our amortization calculator to see a month-by-month breakdown.

Affordability

Want to know how much home you can afford? Just answer a few simple questions and we'll show you an estimate that includes the projected loan amount for which you may qualify, the monthly payments and other important figures.

Monthly Payment Calculator

Your monthly mortgage payment is calculated by adding the costs of the loan’s principal and interest, as well as any money held in escrow for taxes and insurance. How much will it be? Get an idea now and compare different loan terms.

Affordability

Your Results

You can afford a house up to

Based upon the information you provided, a house at this price should fit within your budget.

Based upon the information you provided, a house at this price may be a challenge to fit within your budget.

apply now email my results

Based upon the information entered, some loan products may require a larger down payment than you inputted. Please speak with an experienced loan consultant for more accurate and detailed information.

Results shown are estimates and are based on the accuracy and continued reliability of the data you input. Home-purchase affordability depends on various factors and is not guaranteed. Such factors may include credit score, the loan product chosen, lender guidelines, other financial obligations, changes in market conditions, and more. Alimony, child support, or separate maintenance income need not be revealed if the borrower or co-borrower does not choose to have it considered as a basis for repayment of this loan. Some results may be rounded. These calculations are provided for illustrative purposes only and do not reflect any closing costs. If mortgage insurance payment is listed, illustrative payment is based upon a conforming fixed loan for owner occupied, 1 unit dwelling for a borrower with a credit score greater than 760. This is not a credit decision or a commitment to lend. Please contact an experienced loan consultant at (800) 210-8849 for more accurate and detailed information.

A price cannot be generated based upon the information provided.

Try one of these and recalculate:

  • Increasing your annual income
  • Lowering your monthly debt
  • Increase your down payment

Still not seeing any values? Please contact an experienced loan consultant at (800) 210-8849 to find an option that fits your unique situation.

Monthly Payment Total:

Refinance

Find out if now is a good time for you to refinance to reduce your monthly payment,1 get extra cash or switch to a different loan type or term. Simply enter some information on your current loan, plus the new loan you're considering, and we'll calculate your potential savings.

1By refinancing your existing loan, your total finance charge may be higher over the life of the loan.

Please note that these estimates do not include all applicable fees, and as a result, your actual fees may be higher. For a more accurate closing cost estimate, call (800) 210-8849 to speak with an experienced loan consultant today.

Your Results

  • Estimated Cost to Obtain a New Mortgage
  • Months to Break Even
  • Current Monthly Payment
  • Refinancing Payment
    • Principal + Interest
    • PMI
    • Monthly Payment Reduced By
    • Monthly Payment Increased By
apply now email my results

Results are based solely on the information you have provided. These calculations are provided for illustrative purposes only and do not reflect all applicable fees to obtain a new mortgage and as a result your actual fees may be higher. If mortgage insurance payment is listed, illustrative payment is based upon a conforming fixed loan for owner occupied, 1 unit dwelling for a borrower with a credit score greater than 760. This is not a credit decision or a commitment to lend. Please contact an experienced loan consultant at (800) 210-8849 for more accurate and detailed information.

A price cannot be generated based upon the information provided.

Still not seeing any values? Please contact an experienced loan consultant at (800) 210-8849 to find an option that fits your unique situation.

Monthly Savings

Rent Vs. Buy

Your Results

  • Gross Cost of Renting
  • Gross Cost of Buying
    • Principal + Interest
    • Property Taxes
    • Homeowners Insurance
    • PMI
    • Down Payment
    • Closing Costs
  • Net Cost of Buying
    • Home Appreciation
    • Principal Paid
apply now email my results

Results are based solely on the information you have provided; product may not be available for all terms entered. These calculations are provided for illustrative purposes only. If mortgage insurance payment is listed, illustrative payment is based upon a conforming fixed loan for owner occupied, 1 unit dwelling for a borrower with a credit score greater than 760. This is not a credit decision or a commitment to lend. Please contact an experienced loan consultant at (800) 210-8849 for more accurate and detailed information.

A scenario cannot be generated based upon the information provided.

Try one of these and recalculate:

  • Lowering your purchase price
  • Increasing your down payment
  • Changing the loan term

Still not seeing any values? Please contact an experienced loan consultant at (800) 210-8849 to find an option that fits your unique situation.

Rent or Buy?

Buy

Buying could save you

This is based upon the values you provided and planning to reside in the purchased home for year(s).

Rent

Renting could save you

This is based upon the values you provided and planning to reside in the rented home for year(s).


Amortization Calculator

Curious to see how much principal and interest you will pay over the life of your loan? Input your information into our amortization calculator to see a month-by-month breakdown.

Your Results

Monthly Payment

Total Interest Paid

Total Interest Saved

apply now email my results

Results are based solely on the information you have provided; product may not be available for all terms entered. These calculations are provided for illustrative purposes only and do not reflect any mortgage insurance, closing costs or down payment. Please contact an experienced loan consultant at (800) 210-8849 to find the loan that fits your needs.

Show Full Payment Schedule

A scenario cannot be generated based upon the information provided.

Still not seeing any values? Please contact an experienced loan consultant at (800) 210-8849 to find an option that fits your unique situation.

Payment Schedule

Articles

Frequently Asked Questions

General FAQs
Valuable information about how to use this site and descriptions of general processes. Learn how we ensure your information is secure, when and how to be approved for a loan and how to change your information after you have submitted it.

Home Purchase FAQs
From when to start mortgage shopping to what happens at closing. Understand interest rate options, down payment information, how a decision is made, what documents are needed at closing and more.

Refinance FAQs
The facts you need before you decide to refinance. When should you consider refinancing? What are some reasons to refinance? How much home equity can you use? Learn about cash out refinancing, the rescission period, how a refinance closing works and more.

Credit FAQs
What is credit? How can you establish and maintain good credit? How can you improve your credit score? What is your credit report and how can you see it? What are the best ways to avoid credit problems? Find the answers here.

General Frequently Asked Questions

Online Security

We respect the fact that a mortgage loan application contains confidential information that needs to be treated responsibly and with care. For that reason, we use an advanced security system in all Internet-based communications and in the management of personal records. For complete details on how we protect your information and the security methods we use, please visit the Your Privacy page.

Fees

IMPORTANT NOTE: The below chart is a list of common fees and costs that may be incurred by the borrower as a result of services requested and/or services rendered or incurred in connection with the mortgage loan. Actual fee amounts may vary depending upon the terms of the loan documents and applicable state and federal laws and regulations. This list does not include all fees and costs that may be charged, including, but not limited to, non-common costs, foreclosure costs, bankruptcy fees, attorneys fees and court costs. If you have any questions about other fees or services, please contact Customer Service.

Fee/Cost Title

Description

Amount/Calculation

Loan /Payment History

Document that provides the last twelve (12) months, unless other time period requested, showing the date and amount of all payments made or credited to the account and total unpaid balance.

$0.00 - $10.00 each*

Bad Check/ Non-sufficient Funds Fee ("NSF")

Fee charged to borrower due to bad check or insufficient funds in account used to tender payment.

$0.00 - 50.00 each*

SpeedPay via Website/ Automated Phone System

Fee charged to borrower when borrower uses the SpeedPay system to cover costs to process SpeedPay payments.
Paying via SpeedPay is one of the one-time payment options that a borrower may use to make his/her monthly mortgage payment.
Borrowers who have registered for Paperless Statements through the Message Center will not incur a fee to process a SpeedPay payment on the website.

$7.50 each*

SpeedPay via Extranet (Representative only)

Fee charged to borrower when borrower uses a live representative to process a SpeedPay.
Paying via SpeedPay is one of the one-time payment options that a borrower may use to make his/her monthly mortgage payment.

$17.50 each*

Late Fee

A fee charged to you when you fail to pay your mortgage payment as agreed; on or before your payment due date and/or prior to the expiration of your grace period.

Late fees are assessed in accordance with the terms of your Note and Mortgage/Deed of Trust

Property Inspection

Fee charged to borrower for an exterior inspection of property when loan is delinquent 45 days or more.

$0.00 - $40.00 each inspection*

Copy of Amortization
Schedule

Schedule that reflects the monthly mortgage payments broken down by interest and principal for paying off the loan based on loan term (i.e. 30 years, 15 years, etc.).

$0.00 - $15.00 each*

Payoff Quote Fee (Demand Fee)

Fee charged to a borrower when a payoff statement is requested.

$0.00 - $30.00 each

Copy of Loan Documents

Fee charged to borrower when copies of loan documents, including but not limited to note, mortgage, duplicative escrow statements or duplicative 1098s are requested by borrower.

$0.00 - $10.00 each*

Duplicate Coupon Book

Fee charged to borrower if duplicate copy of coupon book is requested.

$0.00 - $5.00 each*

Verification of Mortgage

Fee charged to borrower or authorized third-party for document verifying mortgage.

$0.00 - $20.00 each*

Priority Statement Fee

Fee charged to borrower for an urgent or faxed request for documentation in addition to any document charge.

$0.00 - $20.00 each*

Certified Mailing Fee

Fee charged to a borrower for a certified mailing.

$0.00 - $7.30*

*Subject to investor guidelines and/or state restrictions

IMPORTANT NOTE: The below chart is a list of common fees and costs that may be incurred by the borrower as a result of services requested and/or services rendered or incurred in connection with a HELOC mortgage loan. Actual fee amounts may vary depending upon the terms of the loan documents and applicable state and federal laws and regulations. This list does not include all fees and costs that may be charged, including, but not limited to, non-common costs, foreclosure costs, bankruptcy fees, attorney's fees and court costs. If you have any questions about other fees or services, please contact Customer Service.

Fee/Cost Title

Description

Amount/Calculation

Loan /Payment History

Fee charged to borrower when the loan or payment history is requested. Document that provides the last twelve (12) months, unless other time period requested, showing the date and amount of all payments made or credited to the account and total unpaid balance.

$0.00 - $10.00 each*

Bad Check/ Non-sufficient Funds Fee ("NSF")

Fee charged to borrower due to bad check or insufficient funds in account used to tender payment.

$0.00 - 50.00 each*

SpeedPay via Website/ Automated Phone System

Fee charged to borrower when borrower uses the SpeedPay system to cover costs to process SpeedPay payments.
Paying via SpeedPay is one of the one time payment options that a borrower may use to make his/her monthly mortgage payment.
Borrowers that have registered for Paperless Statements through the Message Center will not incur a fee to process a Speedpay payment on the website.

$7.50 each*

SpeedPay via Extranet (Representative only)

Fee charged to borrower when borrower uses a live representative to process a SpeedPay.
Paying via SpeedPay is one of the one-time payment options that a borrower may use to make his/her monthly mortgage payment.

$17.50 each*

Late Fee

Fee charged to you when you fail to pay your mortgage payment as agreed; on or before your payment due date and/or prior to the expiration of your grace period.

Late fees are assessed in accordance with the terms of your Note and Mortgage/Deed of Trust

Recording Fee (payoff)

A recording fee is money that is paid to a government agent for the removal of the HELOC lien when the account is paid off and closed.

Varies by state

Payoff Quote Fee (Demand Fee)

Fee charged to a borrower when a payoff statement is requested.

$0.00 - $30.00 each*

Copy of Check/Loan Documents

Fee charged to a borrower when copies of loan documents, including but not limited to, note, mortgage, or duplicate 1098 are requested.

$0.00 - $2.00 each*

Duplicate Checkbook

Fee charged to borrower if duplicate checkbook is requested.

$0.00 - $4.00 each*

Outbound Wire Fee

Fee charged to borrower to process an outbound wire transfer.

$0.00 - $25.00 each*

Inbound Wire Fee

Fee charged to borrower to process an incoming wire payment on their account.

$0.00 - $25.00 each*

Verification of Mortgage Fee

Fee charged to borrower for document verifying mortgage information.

$0.00 - $20.00 each*

Priority Statement Fee

Fee charged to borrower for an urgent or faxed request for documentation in addition to any document charge.

$0.00 - $20.00 each*

HELOC Subordination Fee

Fee charged to borrower to process a request to subordinate HELOC loan to a new senior lien. Additional fees may apply if modification to credit limit is required.

$0.00 - $250.00 each*

Line Decrease Fee

Fee charged to borrower to process a request to decrease the credit limit on a HELOC account.

$0.00 - $50.00 each*

FRO/Segmentation Lock Fee

A processing fee charged to borrower when borrower requests to segment a portion of the outstanding balance and lock-in a specific interest rate and term based on investor guidelines.

$0.00 - $50.00 each*

NSF Draw Fee

Fee charged to borrower when a HELOC draw check advance is returned due to insufficient funds available.

$0.00 - $30.00 each*

Stop Payment Fee

Fee charged to borrower when a stop payment request is added to a HELOC draw check.

$0.00 - $30.00 each*

Property Inspection Fee

Fee charged to borrower for an exterior inspection of property when loan is delinquent 45 days or more.

$11.00 - $40.00 each insepction*

Certified Mailing Fee

Fee charged to a borrower for a certified mailing. 

$0.00 - $7.30*

*Subject to investor guidelines and/or state restrictions

Get Assistance

  1. If you are not satisfied with any aspect of the servicing of your account, please contact our Customer Service Department at (800) 210-8849.
  2. If you remain unsatisfied with your response from our Customer Service Department, please contact an escalation specialist at (855) 703-3662. Our escalation specialists are available from 8:30 a.m. to 5 p.m. (ET).
  3. We will provide you with a substantive response generally within 30 calendar days of receipt. If we require more than 30 days to provide a substantive response to you, we will so advise you within 30 days of receipt.

What you need to provide:

  • Your name, mortgage loan account number, and property address
  • A daytime telephone number or email address where we can contact you
  • A clear description of your concern or problem

If you wish to request information or assert an error relating to the servicing of your mortgage loan, including any Qualified Written Requests, you must use the address below and include your name, your mortgage loan account number, property address and a statement of either the information you are requesting or the error you believe has occurred:

PHH Mortgage Services 
P.O. Box 66002 
Lawrenceville, NJ 08648

Purchase Frequently Asked Questions

Finding a Mortgage

When should I start evaluating financing options, and how do I know what I can afford?

Do I need to sell my current home before I apply for a new mortgage loan?

How much down payment will I need?

Can I be pre-approved for a loan if I have credit problems?

Why is an appraisal necessary? Can I use the tax value of the home?

How do I get an appraisal?

How much will my property taxes be?

What is a Truth in Lending statement?

Rates and Costs

What is the Annual Percentage Rate of a loan, and how is it different from the interest rate?

How often do interest rates change?

What factors go into determining the interest rate on my loan?

When should I lock my rate?

Once I have selected a program, what are my rate options?

What if interest rates go down after I lock my rate?

What happens if my loan doesn't close before the rate lock expiration date?

What are points and how do they work?

If I'm short on cash, do I have options to help with my down payment and closing costs?

Pre-Approval Decision

How can I apply for a loan and find out the decision?

What factors will a mortgage lender consider when making a pre-approval decision?

Can I change the loan amount, down payment or program after I've received my loan pre-approval decision?

I already put a deposit down on the home or property. Is this included in the Good Faith Estimate?

What documents will I need to provide to complete my loan transaction?

Closing

Do I have to attend the closing in person?

What checks do I need to bring to the closing?

What is title insurance and why is it required?

How much title insurance do I need?

How much homeowners’ insurance do I need?

How do I know if I need flood insurance?

How are my property tax bills paid?

What type of inspections do I need before I close on my home?

Refinancing Frequently Asked Questions

The Refinancing Process

What is refinancing and what are some reasons people choose to refinance?

How does a cash out refinance work?

How much of my home's equity can I use to refinance?

Can I still refinance even if I don't have much equity?

Closing

How much does a refinance closing cost?

What are the steps involved in a refinance closing?

Am I required to bring certified funds to closing?

How do I know the final dollar amount I will need for closing?

What if I'm not able to attend the closing?

What is the rescission period?

Credit Frequently Asked Questions

About Credit

What is credit?

What is good credit? And how can I establish it?

What qualifies as a late payment, and what are the consequences?

I'm concerned about my credit. How can I improve it?

Can I apply for a loan if I don't have an established credit history?

Your Credit Report and Credit Score

What is a credit report?

What is a credit score?

How can I view my credit report?

How can I correct errors on my credit report?

How can I improve my credit score?

What if I am having trouble paying large debts?

Situations with Negative Impact

What is foreclosure?

What is repossession?

How does foreclosure or repossession affect a credit report?

What is bankruptcy?

How does bankruptcy affect a credit report?

How can I avoid credit problems?

To discuss your credit with an experienced loan consultant, call (800) 210-8849.

Loan Options

Need help understanding the financing options for your new home or property? With a wide variety of products to choose from, PHH Mortgage has one to fit your needs. Read more to understand which mortgage program may be right for you.

Main Types of Loans

Generally, mortgage loans fall into two main categories: fixed rate mortgages and adjustable rate mortgages.

There are several loans options available depending on your eligibility. The type you choose will depend on your specific financial situation.

Find Out More

Fixed Rate Mortgages

With a fixed rate mortgage, payments toward both the interest and principal remain constant over the life of the loan. As a result, monthly loan payments stay the same. Taxes, however, may change according to local or state tax laws.

Advantages of fixed rate mortgages:

  • The interest rate stays the same – it doesn’t go up even if rates in the market do.
  • Monthly payments of principal and interest don’t change.
  • They may be a good choice for buyers who plan to own their new homes for a long time.

Disadvantages of fixed rate mortgages:

  • They may cost more than other loan types – the interest rate is often higher than rates for adjustable rate mortgages.
  • A long-term loan may not be suitable for a homebuyer planning to sell or refinance a new home within five to seven years.

Types of Fixed Rate Mortgages

Fixed rate mortgages traditionally have 15-year or 30-year amortization terms. PHH Mortgage offers these options, as well as loans with 20-year and 25-year terms.

A 30-year fixed rate mortgage offers consistent monthly payments for the entire 30 years you have the mortgage. So if the market is good, you can benefit from locking in a lower rate for the full term of the loan. This is the best choice if you’re looking for a long-term, stable loan — for instance, if you’re planning on staying in your house for some time.

A 25-year fixed rate mortgage offers consistent monthly payments for the entire 25 years you have the mortgage. So if the market is good, you can benefit from locking in a lower rate for the full term of the loan. This product option may be a good choice if you’re looking for a long-term, stable loan and want to build equity more quickly than with a 30-year loan.

A 20-year fixed rate mortgage allows you to make a consistent monthly payment throughout the 20 years you have the mortgage. The shorter term means you pay the loan off more quickly, and therefore pay less interest. And you'll build equity faster than you would with a 30-year loan. (But remember, the shorter term means higher payments when compared to the 30-year fixed rate mortgage.)

A 15-year fixed rate mortgage means consistent monthly payments for all 15 years you have the mortgage. By building equity even more quickly than with a 30-year or 20-year loan, and paying less interest, you'll save money in the long run. It's an ideal option if you can handle the higher payments and if you'd like to have the loan paid off in a shorter period of time – for instance, if you plan to retire.

Which term will work best for you?

A short-term loan:

  • May work well for a homebuyer planning to own a home for a shorter length of time
  • Enables a homebuyer to pay off the loan more quickly
  • Generates less interest, and therefore lower overall costs, over the life of the loan
  • Translates into higher monthly payments
  • Builds equity more quickly

A long-term loan:

  • May be good for a homebuyer planning to own a home for a longer time period
  • Results in the loan being paid off more slowly
  • Generates more interest, and therefore higher overall costs, over the life of the loan
  • Translates into lower monthly payments
  • Builds equity more slowly

Adjustable Rate Mortgages

With an adjustable rate mortgage (ARM), the interest rate is fixed for a certain number of years, and then it goes up or down periodically based on a benchmark economic index. With every rate adjustment, the mortgage payment will change. The initial rate of an ARM is usually lower than the rate of a fixed rate mortgage.

The amount of time between rate adjustments is called the adjustment period. Many ARMs have a one-year adjustment period, meaning that the interest rate will adjust every year. Because rate adjustments can be unpredictable, most ARM programs offer a rate cap that limits the amount the interest rate can increase each year or over the term of the loan. The term for most ARMs is 30 years.

Advantages of an ARM:

  • After the initial fixed rate period, monthly payments could decrease if interest rates go down.
  • It may be a good choice for a homebuyer who plans to sell a new home after a few years.
  • It may be suitable for a homebuyer planning to refinance a new home within five to seven years.
  • It may be appropriate for a homebuyer who likes the initial payment stability but can afford later adjustments in interest.

Disadvantages of an ARM:

  • After the initial fixed rate period, monthly payments could increase if interest rates go up.
  • It may not be the optimal choice for homebuyers on fixed incomes.
  • It may not be the best choice for homebuyers who plan to keep their homes or properties for longer than the initial fixed rate period.

Types of Adjustable Rate Mortgages

An ARM is often written as a pair of numbers – for instance, “3/1 ARM”, “5/1 ARM”, “7/1 ARM” or “10/1 ARM.” The first number indicates the number of years the interest rate will remain fixed. The second number indicates the adjustment period of the loan, or how many years it will be before the interest rate adjusts.

With a 3/1 adjustable rate mortgage, you have three years at the initial fixed rate, then the rate adjusts every year for the remaining life of the loan. This could be a good choice if you expect to move or refinance in a relatively short period of time. But a much shorter fixed-rate period means your interest rate (and therefore monthly payments) may begin to fluctuate after three years.

A 5/1 adjustable rate mortgage means the initial rate remains fixed for the first five years of repayment, then adjusts every year thereafter. Remember that your rate and monthly payments may go up after only five years, so this choice is best if you're expecting to sell or refinance the property within that period.

A 7/1 adjustable rate mortgage offers an initial rate that is fixed for the first seven years of repayment. After seven years, the rate adjusts every year thereafter for the remaining life of the loan.

With a 10/1 adjustable rate mortgage, the initial rate of the loan is fixed for the first ten years of repayment. After 10 years, the rate adjusts every year thereafter for the remaining life of the loan. The loan is amortized over 30 years, so you'll enjoy the stability of a 30-year mortgage at a lower price than a fixed-rate mortgage of the same term. But an ARM is likely not the best choice if you're planning on owning the same property for more than 10 years.

Adjustable-Rate Mortgage Disclosures

Type of ProductAdjustable Rate Disclosures
3/1 Year P&I ARMsDownload PDF
5/1 Year P&I ARMsDownload PDF
7/1 Year P&I ARMsDownload PDF
10/1 Year P&I ARMsDownload PDF

To learn more, review the consumer handbook on adjustable rate mortgages.

More Loan Options

Jumbo Loans

A jumbo loan is a loan for an amount of money larger than the conforming loan limits set by government-backed agencies Fannie Mae and Freddie Mac. The current conforming loan limit for a single-family home is $424,100 in all states except Hawaii and Alaska and in designated high-priced markets. Loan limits in high-cost areas vary by location.

Federal Housing Administration (FHA) Mortgages

An FHA-insured and guaranteed loan is designed to make purchasing a home more affordable, especially for first-time homebuyers. FHA loans feature lower down payments and higher qualifying ratios than most conventional mortgages.

  • A mortgage secured by the Federal Housing Administration (FHA) requires a down payment as low as 3.5% of the purchase price.
  • FHA loans are subject to limits on the amount of money that can be borrowed, which vary from state to state.

Veterans Affairs (VA) Mortgages

A VA loan is a low- or no-down-payment mortgage guaranteed by the United States Department of Veterans Affairs. It is only available to military personnel, veterans or spouses of veterans who died of service-related injuries.

  • Under the law, veterans are entitled to VA home loan benefits based on military service. Eligible veterans must still meet credit and income standards in order to qualify for a VA-guaranteed loan.
  • A lender cannot make a VA-guaranteed loan to an ineligible applicant under any circumstances.

For more information about the type of loan that might be right for you, or to discuss eligibility and details, call (800) 210-8849 to speak with a loan consultant.

Glossary

Abstract of Title

A summary of the property's title history. Based on information found in public records, it is used to list the property's transfers of ownership, and to determine if there are any liens or defects that must be cleared before the sale.

Adjustable Rate Mortgage

A mortgage in which the interest rate periodically adjusts based on a pre-selected economic index, such as Treasury bill or prime rates. The initial interest rate, or "teaser rate," is fixed for a given number of years, and is usually lower than rates for traditional fixed rate mortgages — making monthly payments lower as well. When the interest rate begins to adjust, mortgage payments may go up or down along with it, at intervals specified in the ARM product disclosure.

Adjustment Date

The lower initial rate of an ARM can increase purchasing power and enable you to consider a more expensive home than might be possible with a fixed rate mortgage. But keep in mind — the interest rate and monthly payments may increase when the rate begins to adjust.

Adjustment Period

The amount of time between the adjustment dates for an adjustable rate mortgage (ARM). Many ARMs have a one-year adjustment period, meaning that the interest rate will adjust (go up, down, or stay the same) every year. But there are ARMs with six-month and even three-year adjustment periods.

Amenity

A feature of a property that increases the attractiveness or value, but is not necessarily essential to the property's use. Amenities include features such as gardens, pools or beautiful views.

Amortization

The gradual reduction of your loan balance through scheduled periodic payments. For mortgage balances, payments are generally made every month. A portion of the payment goes to the loan principal and a portion goes to the interest. An amortization schedule shows the balance after each payment is made.

Amortization Term

The amount of time you have to repay the mortgage loan. It is usually expressed in months. For example, the amortization term for a 30-year mortgage is "360 months" (12 mo/yr x 30 yrs).

An abbreviation for "Principal, Interest, Taxes and Insurance" — the four charges that make up your monthly mortgage payment.

A percentage of your loan amount, paid at closing. For instance, on a $90,000 loan amount, 1 point = 1 % or $900. You may have the option to pay points to buy down (reduce) your interest rate. Alternatively, in exchange for a higher rate, the lender may pay points to offset your closing costs. These are called negative points. See Discount Points.

Annual Percentage Rate

The cost of your mortgage loan expressed as a yearly rate. The components that are used to formulate the APR are, Note Rate — The stated interest rate, Points, Per Diem Interest - The daily interest charged on your loan from the day of closing to the end of the month, Other Applicable Fees — PMI, etc, The APR does not affect your monthly payment — amortization is computed on the note rate.The cost of your mortgage loan expressed as a yearly rate.

Appraisal

An estimate of the current market value of the home you intend to buy, prepared by a professional appraiser. The estimate is based on the property's appearance, style and construction quality, as well as on the value of similar properties, or comparables that were recently sold in the area.

Appraisal Fee

Your lender may require that you get an appraisal, a professional analysis of your property and neighborhood to determine the approximate value of your home. The appraisal fee is the amount charge for the appraisal. The amount that you're eligible to borrow is based largely on your property's appraised value.

Appreciation

An increase in the value of your property because of positive events, such as favorable changes in market conditions or enhancements made to the property.

ARM

See Adjustable Rate Mortgage.

Assessment

A local area tax charged against a property for a specific purpose, such as a sewer or street signage.

Asset

Anything of monetary value you own outright, including property, bank accounts, stocks and mutual funds. A review of assets is an important part of the mortgage application process.

Homeowners Assistance

If you are having trouble making your monthly mortgage payment, PHH Mortgage can help. There are options available that may allow you to keep your house by making your payments more affordable. Click through the following options to learn more:

If you have explored all of the options that allow you to stay in your home and are still unable to continue making your monthly mortgage payments, here are some options to assist you in avoiding foreclosure:

Would you like to start the process of applying for any of the above? CLICK HERE and scroll down to the bottom section, "Having Trouble Paying Your Mortgage?" After you click the "Get started" link you will be taken to a log-in page where you will need to register in order to log in.

Repayment Plan

You may have had a short-term hardship that resulted in the inability to make your mortgage payment. If that hardship is resolved, a repayment plan may be an option for you. We will review your application for homeowners' assistance and determine if this is an affordable option for you. This will allow you to bring your mortgage loan current, without altering the terms or maturity date of your note.

Ready to apply? CLICK HERE and scroll down to the bottom section, "Having Trouble Paying Your Mortgage?" After you click the "Get started" link you will be taken to a log-in page where you will need to register in order to log in.

Forbearance Plan

A forbearance plan may be an appropriate option for you if you are experiencing an unresolved, short-term financial hardship. This hardship may be due to loss of income resulting from unemployment, illness, or perhaps a disaster. A forbearance plan will allow you to reduce or suspend your mortgage payment for a set period of time.

We will review your application for homeowners' assistance and determine if this is a suitable option for you. Upon the conclusion of the forbearance plan, you will be required to repay the amount that is past due as a result of the forbearance plan. However, you can apply for a repayment plan or a modification to determine if you're eligible for either of those options to assist in resolving the delinquency to bring your account current.

Ready to apply? CLICK HERE and scroll down to the bottom section, "Having Trouble Paying Your Mortgage?" After you click the "Get started" link you will be taken to a log-in page where you will need to register in order to log in.

Natural Disaster

If you have experienced a natural disaster, please contact our Severe Weather Impact Team at (800) 936-8705 to discuss potential options available to assist you during this difficult time.

Loan Modification

If you have experienced a financial hardship that resulted in the inability to pay your mortgage payments, or you anticipate that you may have trouble paying your mortgage timely due to a change in your financial circumstances (e.g. divorce, death of a borrower, or a long-term disability), then a modification of your existing loan terms may be the appropriate option for you.

Modification terms will be determined based on a review of your financial information provided by you in your complete application for homeowners' assistance. The potential terms are set forth by the investor of your loan. They could include a possible rate reduction, an extension of the term of your loan, or even a principal deferment to reduce your total monthly payment to an affordable payment so that you can remain in your home.

There are some key eligibility factors for a loan modification. These may include:

  • the ability to support the modified payment
  • the desire to retain the property
  • the property is a 1-4 unit property or manufactured home
  • a verifiable hardship

All parties on the loan must agree to participate in the modification process. This may include providing their financial documentation if they co-signed on the loan, or simply signing the modification agreement if they were a signing party on the original Mortgage/Note. If you are concerned about your individual circumstances, please discuss with your Case Manager.

If you are deemed ineligible for a modification, you will receive a notice of the decision, along with the reason that the request for modification could not be approved. If you're not eligible for a modification, you may want to consider options that involve liquidating the property. Your Case Manager will walk you through this process so you understand completely all of your options so that you can make an informed decision as to what is the best choice for you.

Available modification options are specific to the type of loan you have. If you are not sure what type of loan you have, please call PHH Mortgage Customer Service at (800) 330-0423. 

Hardest Hit Fund Program

Hardest Hit Fund (HHF) programs in 18 states and the District of Columbia are designed to provide assistance to struggling homeowners through modification, mortgage payment assistance, and transition assistance programs. These programs change frequently; therefore, we recommend checking back often for updates.

Features and benefits - HHF Programs vary state to state, but often include:

  • Mortgage payment assistance for unemployed or underemployed homeowners
  • Principal reduction to help homeowners get into more affordable mortgages
  • Funding to eliminate homeowners' second lien loans
  • Help for homeowners who are transitioning out of their homes and into more affordable places of residence

Eligibility - HHF program and eligibility vary by state. To see if your state is eligible and for availability details, go to the HHF page on the Making Home Affordable website and scroll down to "Availability."

Pre-Foreclosure Sale

Steps in the Pre-Foreclosure Sale process

1. Call your Case Manager to discuss this process. Before calling in, gather the following information: 

  • Loan number and property information
  • Details of the offer and a copy of the signed contract, if applicable
  • Information on any home equity loans or lines of credit on the property, if applicable
  • Details about your hardship

2. List the property for sale

If you haven't received an offer yet, please be aware that you're required to work with a licensed real estate professional to market and sell the property. We strongly recommend working with a real estate agent who is experienced in short sales and who can help guide you through the process. You may receive a phone call from an authorized PHH vendor to discuss the strategy for listing the property for sale and they may provide names of local realtors to assist you with listing and selling the property.

3. You've received an offer on your house

Your agent will need to submit the offer to us for consideration.

4. Decision process

Within 30 days of receiving your complete response package, we will determine if you are eligible to participate in the short-sale transaction. We will review and validate your hardship, which may include a full financial analysis of your application if required by your investor. Once you are deemed eligible to participate, we will send you a notification that you are pre-approved for the transaction and have 45 days to forward a short-sale offer. If you included the short-sale offer with your application and we have deemed you eligible to participate, we will begin the process of reviewing the offer immediately. A professional appraiser will contact your listing agent to perform a valuation of the property to determine the fair market value. Once the fair market value is determined, it’s possible we may make a counter offer. We will be working to obtain approval from the investor of your loan during the offer review process. When all necessary parties have accepted the offer, we will provide you with an approval letter and a closing instruction package releasing the house for purchase.

5. Offer accepted

Final documents will be prepared and your real estate agent will work with you to set a closing date. After the closing, the sale of the property is complete.

NOTE: If the funds from your traditional short sale don't cover the amount owed on your loan, you may be responsible for paying the deficiency.

Ready to apply? CLICK HERE and scroll down to the bottom section, "Having Trouble Paying Your Mortgage?" After you click the "Get started" link you will be taken to a log-in page where you will need to register in order to log in.

Deed In Lieu

Steps in the Deed in Lieu process

1. Call your Case Manager to discuss this process. Before you call in, gather the following information:

  • Loan number and property information
  • Information on any home equity loans or lines of credit on the property, if applicable
  • Details about your hardship

2. After we have received all of the information requested we will:

  • Order an interior appraisal to determine the current market value
  • Compare the value to the balance on your first mortgage
  • Perform a title search to ensure the property is free of any liens

3. Approval

If your request for a deed in lieu is approved, we will send you a letter stating the terms and conditions of the approval, along with documents that you will need to sign and return. You will have 14 calendar days to sign, notarize and return the release documents to us. You will have up to 30 calendar days to relocate, depending on the law in your area.

Ready to apply? CLICK HERE and scroll down to the bottom section, "Having Trouble Paying Your Mortgage?" After you click the "Get started" link you will be taken to a log-in page where you will need to register in order to log in.

FHA Loan Modification

Getting started on a loan modification for an FHA-insured loan:

1. Call and speak to your Case Manager and request an application for homeowners' assistance so that you may apply for assistance. 

2. Gather the following documents:

  • If you receive a salary or hourly wages: Provide most recent consecutive 30 days of pay stubs. The pay stubs must reflect YTD earnings. If not reported on the pay stubs, we will require a signed letter or printout from your employer stating YTD earnings. 
  • SSI, disability or death benefits, retirement, or pension, public assistance, or adoption assistance income: Provide the most rcent award letter and most recent 2 months bank statements evidencing proof of receipt of these funds.
  • Self-employed: Provide your most recent quarterly or YTD Profit & Loss statement, and the most recent year's filed federal tax return including all schedules.
  • Alimony, child support, or separate maintenance income: Please note that you are not required to disclose this income unless you wish to use these funds to help you qualify for assistance. If you choose to use these funds, please provide a copy of the divorce decree, separation agreement, or other written agreement filed with the court or equivalent document that states the amount and period of time over which the payment will be received. Documentation must confirm that payments will continue for at least 12 months AND provide 2 most recent bank statements or other third-party documentation showing receipt of payment.
  • Rental income: Provide a copy of the most recent filed federal tax return with all schedules, including Schedule E, OR if rental income is not reported on Schedule E, provide a copy of the current lease agreement with either bank statements or cancelled rent checks demonstrating receipt of rent.
  • Investment income: Provide copies of the 2 most recent investment statements or bank statements supporting receipt of this income.
  • Contributor income: If you have a non-borrower living in the property, regularly contributing to your monthly expenses, we will require the same documentation outlined above as for each borrower, to verify the ability to contribute to the household expenses on a regular basis.

3. Fill out the Financial Worksheet, two pages completed, signed and dated. The Financial Worksheet can be found on the Loan Solution Center site. To access this site, go to the "Ready to apply" section below.

To go back to the Loan Modification page, click here.

To go back to the Homeowners' Assistance page, click here.

Ready to apply? CLICK HERE and scroll down to the bottom section, "Having Trouble Paying Your Mortgage?" After you click the "Get started" link you will be taken to a log-in page where you will need to register in order to log in.

VA Loan Modification

Getting started on a loan modification for an VA-insured loan:

1. Call and speak to your Case Manager and request an application for homeowners' assistance so that you may apply for assistance.

2. Gather the following documents:

  • If you receive a salary or hourly wages: Provide most recent consecutive 30 days worth of pay stubs. The pay stubs must reflect YTD earnings. If not reported on the pay stubs, we will require a signed letter or printout from your employer stating your YTD earnings.
  • SSI, disability or death benefits, retirement, or pension, public assistance, or adoption assistance income: Provide the most recent award letter and most recent 2 months bank statements evidencing proof of receipt of these funds.
  • Self employed: Provide your most recent quarterly or YTD Profit & Loss statement, and the most recent year's filed federal tax return including all schedules.
  • Alimony, child support, or separate maintenance income: Please note that you are not required to disclose this income unless you wish to use these funds to help you qualify for assistance. If you choose to use these funds, please provide a copy of the divorce decree, separation agreement, or other written agreement filed with the court or equivalent document that states the amount and period of time over which the payment will be received. Documentation must confirm that payments will continue for at least 12 months. AND provide 2 most recent bank statements or other third-party documentation showing receipt of payment.
  • Rental Income: Provide a copy of the most recent filed federal tax return with all schedules, including Schedule E. OR if rental income is not reported on Schedule E, provide a copy of the current lease agreement with either bank statements or cancelled rent checks demonstrating receipt of rent.
  • Investment income: Provide copies of the two most recent investment statements or bank statements supporting receipt of this income.
  • Contributor income: If you have a non-borrower living in the property, regularly contributing to your monthly expenses, we will require the same documentation outlined above as for each borrower, to verify the ability to contribute to the household expenses on a regular basis.

3. Fill out the Financial Worksheet, two pages completed, signed and dated. The Financial Worksheet can be found on the Loan Solution Center site. To access this site, go to the "Ready to apply" section below.

To go back to the Loan Modification page, click here.

To go back to the Homeowners' Assistance page, click here.

Ready to apply? CLICK HERE and scroll down to the bottom section, "Having Trouble Paying Your Mortgage?" After you click the "Get started" link you will be taken to a log-in page where you will need to register in order to log in.

FNMA/FHLMC

Getting started on a loan modification for a Fannie Mae (FNMA) or Freddie Mac (FHLMC) insured loan:

1. Call and speak to your Case Manager and request an application for homeowners' assistance so that you may apply for assistance.

2. Gather the following documents:

  • If you receive a salary or hourly wages: Provide most recent consecutive 30 days worth of pay stubs. The pay stubs must reflect YTD earnings. If not reported on the pay stubs, we will require a signed letter or printout from your employer stating your YTD earnings.
  • SSI, disability or death benefits, retirement, or pension, public assistance, or adoption assistance income: Provide the most recent award letter and most recent 2 months bank statements evidencing proof of receipt of these funds.
  • Self employed: Provide your most recent quarterly or YTD Profit & Loss statement, and the most recent year's filed federal tax return including all schedules.
  • Alimony, child support, or separate maintenance income: Please note that you are not required to disclose this income unless you wish to use these funds to help you qualify for assistance. If you choose to use these funds, please provide a copy of the divorce decree, separation agreement, or other written agreement filed with the court or equivalent document that states the amount and period of time over which the payment will be received. Documentation must confirm that payments will continue for at least 12 months AND provide 2 most recent bank statements or other third-party documentation showing receipt of payment.
  • Rental income: Provide a copy of the most recent filed federal tax return with all schedules, including Schedule E, OR if rental income is not reported on Schedule E, provide a copy of the current lease agreement with either bank statements or cancelled rent checks demonstrating receipt of rent.
  • Investment income: Provide copies of the 2 most recent investment statements or bank statements supporting receipt of this income.
  • Contributor income: If you have a non-borrower living in the property, regularly contributing to your monthly expenses, we will require the same documentation outlined above as for each borrower, to verify the ability to contribute to the household expenses on a regular basis.

3. Fill out the Financial Worksheet, two pages completed, signed and dated. The Financial Worksheet can be found on the Loan Solution Center site. To access this site, go to the "Ready to apply" section below.

To go back to the Loan Modification page, click here.

To go back to the Homeowners' Assistance page, click here.

Ready to apply? CLICK HERE and scroll down to the bottom section, "Having Trouble Paying Your Mortgage?" After you click the "Get started" link you will be taken to a log-in page where you will need to register in order to log in.

Other Investors

Note: If the investor of your loan is not FHA, VA, FNMA, or FHLMC, below is a general guideline of documentation required to assist you. The investor of your loan may require additional documentation, and if so it will be requested of you. You will be provided 30 days to provide the additional documentation requested.

Getting started:

1. Call and speak to your Case Manager and request an application for homeowners' assistance so that you may apply for assistance.

2. Gather the following documents:

  • If you receive a salary or hourly wages: Provide most recent consecutive 30 days worth of pay stubs. The pay stubs must reflect YTD earnings. If not reported on the pay stubs, we will require a signed letter or printout from your employer stating your YTD earnings.
  • SSI, disability or death benefits, retirement, or pension, public assistance, or adoption assistance income: Please provide the most recent award letter and most recent 2 months bank statements evidencing proof of receipt of these funds.
  • Self employed: Provide your most recent quarterly or YTD Profit & Loss statement, and the most recent year's filed federal tax return including all schedules.
  • Alimony, child support, or separate maintenance income: Please note that you are not required to disclose this income unless you wish to use these funds to help you qualify for assistance. If you choose to use these funds, please provide a copy of the divorce decree, separation agreement, or other written agreement filed with the court or equivalent document that states the amount and period of time over which the payment will be received. Documentation must confirm that payments will continue for at least 12 months, AND provide 2 most recent bank statements or other third-party documentation showing receipt of payment.
  • Rental income: Provide a copy of the most recent filed federal tax return with all schedules, including Schedule E, OR if rental income is not reported on Schedule E, provide a copy of the current lease agreement with either bank statements or cancelled rent checks demonstrating receipt of rent.
  • Investment income: Provide copies of the 2 most recent investment statements or bank statements supporting receipt of this income.
  • Contributor income: If you have a non-borrower living in the property, regularly contributing to your monthly expenses, we will require the same documentation outlined above as for each borrower, to verify the ability to contribute to the household expenses on a regular basis.

3. Fill out the Financial Worksheet, two pages completed, signed and dated. The Financial Worksheet can be found on the Loan Solution Center site. To access this site, go to the "Ready to apply" section below.

To go back to the Loan Modification page, click here.

To go back to the Homeowners' Assistance page, click here.

Ready to apply? CLICK HERE and scroll down to the bottom section, "Having Trouble Paying Your Mortgage?" After you click the "Get started" link you will be taken to a log-in page where you will need to register in order to log in.

Get Your Home Ready to Sell in 6 Easy Steps

Like buying a home, selling a home is a process. There are things you'll need to learn and steps you'll need to take in order to maximize the value of your home and attract the attention of buyers. Here's how you can get your home ready to sell in 6 easy steps.

1. Get a sense of the local real estate market

It's probably been a few years since you bought your current home, which means your local real estate market has most likely changed. Real estate markets go through cycles. You'll want to find out where your local market is in the cycle to gauge how similar homes in your area are selling and how hot the market is.

Local real estate listings are a good place to start. Sites like Zillow and Trulia show listings in your area that are similar to your home in terms of square footage, number of rooms and upgrades. Find out how much they are listed for and how long they’ve been on the market. You can also see purchase prices of recently sold properties.

2. Increase value and equity with curb appeal

No matter what your local market situation is, there are steps you can take to maximize the value of your home. First impressions matter to potential buyers, so think about increasing your house’s curb appeal. It could get you a quicker offer, help you sell your home for more money and help your home stand out in a competitive buyer’s market.

Curb appeal projects can be quick and inexpensive compared to bigger projects like kitchen and bath remodels. Start with cleaning up your front lawn, trimming trees or shrubs, cleaning out gutters and touching up paint. You can even go a step further by adding new landscaping. For your biggest return on investment, purchase a new front door, new garage doors, or consider residing your house. If you're not sure where to focus, look for clues in your local market listings or ask your real estate agent.

3. Give your house a deep spring cleaning

No matter the season, your house needs a deep and thorough cleaning before you put it on the market. You might even consider hiring professional help to get your home in the best shape possible. In addition to your regular cleaning routine, dust and vacuum behind and under furniture, wipe down baseboards, deep clean carpets, and dust light fixtures. Kitchens and bathrooms in particular should be sparkling clean. You may also want to re-caulk sinks, showers and tubs, and think about pressure-washing the exterior and sidewalks. Don't forget the windows – clean them inside and out.

4. Stow away personal effects

A house is a home, which means you likely have many family photos on the walls, kids' art projects on the fridge, as well as many other personal touches. When you sell your home, potential buyers will try to picture themselves living in the space as they walk through. It's easier to help your buyers imagine this is their home by stowing away your personal effects. Depersonalization makes a big difference. If you find you're running out of room for storage, consider a short-term storage rental for personal effects and bulky seasonal items you don't need taking up closet space.

5. Refresh with new paint

How long has it been since you painted? If you can't remember, it may be a good idea to refresh your walls with a new coat of paint. That's particularly true if your home has a bright or personalized color palette. Buyers tend to prefer light, neutral colors, which helps them picture themselves living in your home.

Paint is relatively affordable, and you can do the work yourself. The payoff is the opportunity to make your house look new, vibrant and clean. That creates a great impression for the potential buyers who will tour your home.

6. Talk to the professionals

Finally, make sure to talk to the professionals when it's time to get your home ready to sell. A real estate agent will help advise you every step of the way. You'll be able to get a professional opinion about comparable properties and what your home is actually worth in today's local market. You'll also be able to estimate your bottom line, taking into account potential sales price, mortgage payoff, taxes, fees and closing costs.

You'll want to seek out a lender for questions related to your mortgage, home sale and your next home purchase. It's a good idea to get pre-approved for a mortgage on your next home before you start looking, and your lender will be able to help you with all the details.

If you're not ready to sell

What if you're not yet ready to sell? The great thing about many of these tips is they can help improve the value of your home even when you're not looking to sell. By investing in some curb appeal, spring cleaning and fresh paint, you may be able to increase the value of your home. That, in turn, could let you tap into your equity for a cash-out refinance, home equity loan or home equity line of credit (HELOC). These options could let you consolidate high-interest debt, pay for college or reinvest in your home with bigger home improvement projects.

If you are interested in getting a new home loan or looking to get a cash-out refinance, call one of our knowledgeable loan officers at (800) 210-8849.


This is for informational purposes only. This is not intended as legal or financial advice.

7 Things New Home Buyers Wish They Had Known

There are certain things many new home buyers wish they had known before buying. The problem is, you don’t know what you don’t know, and these are not things you’re going to want to learn the hard way.

Because a home is such a large purchase and commitment, sometimes decisions made – or not made – during the buying process can cause short-term stress or make the process more complicated, while others may even have long-term effects.

To make your home buying process successful, look at these seven things new home buyers wish they had known. Do your best to build them into your home buying process, and you’ll go into the experience feeling well-equipped and excited.

1. You may need more money than just the down payment

People often save for several years to buy a home. Their target amount is usually the down payment. For example, if you expect to purchase a $200,000 home with a 5% down payment, your savings goal will be $10,000. But that may not be all you need! There are several other potential financial requirements you may need to save up for.

  1. Closing costs. These can range between 2% and 4% of the mortgage amount. In some markets, these are customarily paid by the seller, but if that’s not the case in your market, you’ll have to come up with the additional funds.
  2. Prepaid expenses. These are escrows for property taxes and insurance. Depending upon the escrow requirements in the community, these can be anywhere from several hundred to several thousand dollars.
  3. Cash reserves. These are required on some loan programs, but not all. They’re based on the new monthly house payment. For example, if the requirement is for “two months cash reserves” you will have to show that additional savings equal to two months of the new house payment will be available after closing on the home.

If you’re simply saving for the down payment, you may find you don’t have enough to close. That could set you on a mad scramble at the last minute, coming up with money to cover other expenses.

One other possibility, at least regarding closing costs, is what’s known as premium pricing. With this strategy, the lender pays your closing costs in exchange for a slightly higher interest rate on the loan. If this is an option you’d like to pursue, you should discuss it with your loan originator very early in the process.

2. It’s best to clean up your credit before you apply for a mortgage

A comparison chart from myFico.com shows the effect your credit score has on the interest rate you’ll pay on your mortgage. For example, a credit score of 760 or higher may get you a rate of 4.068% on a 30-year mortgage.* By contrast, a score of 690 would get you a rate of 4.467%.* On a $200,000 loan, the monthly payment at 4.068% would be $963. On a $200,000 loan, the monthly payment at 4.467% would be $1,009.**

That’s a difference of “only” $46. But on a 30-year loan, that’s $16,560!

You can increase your chances of securing a lower rate by cleaning up your credit before you apply for a mortgage. Don’t wait until after you apply to get this going. It can take months to increase your credit score, particularly if your score is especially low.

3. A mortgage pre-approval isn’t a final approval

There’s a world of difference between a mortgage pre-approval and final approval. Typically, a pre-approval has conditions. In a final approval, all conditions have been cleared, and you’re ready to close.

Virtually everyone who applies for a mortgage starts out with a pre-approval, but it’s important to understand that pre-approval is the beginning of the process and not a final decision.

If your pre-approval has conditions, and it almost certainly will, you’ll need to clear those conditions before closing. In fact, the sooner those conditions are cleared, the more stress-free the home buying process will be.

Examples of conditions include paying off a certain debt or obligation, providing evidence of additional income, satisfying documentation requirements for a gift, or even selling your current home.

Since many of these conditions require time to complete, it’s best you get working on them as soon as you get your pre-approval. A “clean approval,” which is one with no major conditions, is an excellent bargaining chip when you’re negotiating the price of a property you want to purchase.

4. You won’t necessarily save money buying without a real estate agent

Do you want to know a secret? The buyer doesn’t pay the real estate commission – the seller does.

Translation: you won’t save money buying without a real estate agent. You’ll only be helping the seller to save money on the transaction.

What’s more, since real estate agents help buyers find homes and negotiate contracts, you’ll be giving up a valuable ally in the home buying process.

As a buyer, you should always work with a competent real estate agent.

5. Dual closings work better in theory than in reality

In some markets, it’s common for buyers to work out a “dual closing.” That’s when you attempt to close on the sale of your old home on the same day you close on the purchase of the new one.

In theory, it’s perfect. You leave one closing, then go to the next, and get it all done in one day. What’s more, you don’t have to do the dreaded double move – you can load the truck at your old house, and make an immediate move to the new one.

The reality is that a single real estate transaction is a fairly complicated ordeal. Trying to engineer two closings on the same day can turn into a nightmare. Picture this – you’re all set to do your dual closing, but you find out the day before that the buyer of your old home has had a glitch and can’t close. Now what? Your perfect scenario has been torpedoed by circumstances completely beyond your control.

A better option, if you can make it happen, is to close on your old home with a rent-back provision. That’s where you continue to live in the home for at least a few days after the closing. During that time, you close on the purchase of the new home, then make a single move. That will separate the two transactions and ensure that the sale of your old home is complete before the closing on the new one.

6. Never, ever, neglect a home inspection

Some home buyers neglect a home inspection so they can save a few hundred dollars. Other times, real estate agents discourage the practice. They don’t want to risk the possibility that the discovery of a problem could cause the sale to collapse.

But the money you pay for a home inspection might be the very best money you spend in the entire home buying process. A thorough home inspection will alert you to the exact condition of the property. More important, it will give you an opportunity to identify significant flaws in the home, then negotiate to have the seller make repairs before closing.

Neglect this step, or ignore the results of the inspection, and you could end up paying thousands of dollars after the closing. After all, once you close, the repairs will be solely your responsibility. A home inspection is an opportunity to avoid that outcome.

7. Buying less house than you can afford will keep you from being house poor

It’s common for buyers to buy at the top end of their range of affordability. They may do this with the expectation that their financial situation will grow to match or overcome the high cost of the property. That doesn’t always happen. Sometimes expected promotions and career paths don’t pan out. When that happens, that $2,000 a month payment you could barely afford after closing becomes a permanent problem.

You may have the house of your dreams, but you won’t have much else. The days of going out to dinner or the movies might be gone, and the annual summer vacation could go right out the window – not to mention an inability to save money for emergencies and long-term planning.

This creates a condition known as being house poor. You love your house, but there’s not much money left over for anything else. It’s better to buy a little bit beneath your maximum capability. That will leave extra room in your budget to take care of all the other things in your life that aren’t related to your home.

If you’re looking to buy a home soon, think of this list of seven things new home buyers wish they had known as your guide. Refer to it before and during the home buying process so your plan can go as smoothly as possible. Your future self will be glad you did.

This is for informational purposes only. This is not intended as legal or financial advice.

*https://www.myfico.com/credit-education/calculators/loan-savings-calculator/

**The interest rate given to an applicant will depend on a variety of personal factors including but not limited to, credit history, type of loan and current market rates.

Tips on Buying a New Home from Real Estate Pros

If you think buying a new home is easy, you’ve probably been spending too much time watching HGTV. Everything on TV seems easy, but that effortlessness rarely translates to real life. That’s because real life has real complications, and that’s especially true when it comes to buying a house.

However, we’ve got a few tips for you straight from real estate professionals. Incorporate them into your home buying strategy to make the process quicker and easier.


Line Up Your Mortgage Financing in Advance and Get Pre-approved

There are two reasons to take this step before you even go house shopping:

  1. To know exactly how much mortgage you can qualify for, and thus how much house you can afford.
  2. To make clear to a home seller that you are both motivated and qualified to purchase their home.

Even if you think you’re well-qualified, the seller doesn’t know you from the next potential buyer. The only way to know for sure if you’re qualified for a mortgage is to get pre-approved. This shows sellers that you are worthy of credit and can be taken seriously as a buyer.

Once you get pre-approved, pay close attention to the conditions of that agreement. You should begin doing what you need to satisfy any conditions as soon as possible – even before you select a suitable home. For example, you may be required to provide certain income documents, as well as bank statements, credit explanations and other information. By meeting those requirements early, you’ll ensure a quick and stress-free mortgage process through the closing.

Get Familiar with Prices in Your Desired Areas

Just because you know what a few houses in your neighborhood have recently sold for doesn’t mean you have a full grasp of property values in the area you’re looking to buy. Before you even look in a given neighborhood, you should make sure that it’s in your range of affordability. Prices can vary dramatically from one neighborhood to another, even in the same community.

Go to real-estate websites or look through local newspapers to see what prices are being asked for homes in the area. Do your homework so you’ll be prepared for the price levels when you go out looking. Everyone wants a nice home, but it will do little good to look at properties you can’t afford to buy.

Investigate Local Schools – Even if You Don’t Have Kids

It’s important to know what amenities there are in a neighborhood or community. This can include recreational amenities, cultural events, shopping, houses of worship, and proximity to public transportation and major highways.

One of the most important amenities in any neighborhood is the local school system. When it comes to property values and neighborhood desirability, the quality of the local school system is sometimes the most important factor.

Don’t ignore this part of your research just because you don’t have children. School quality is an important attribute in any community, even among people who don’t have children. That’s because buyers are keenly aware that the quality of the school system is a critically important factor in determining current and future property values.

Don’t just go by word of mouth on this issue. Look up the schools in the community on GreatSchools.org. They provide a numeric rating of schools – elementary, middle and high schools – from 1 to 10, with 10 being the most highly rated schools.

Attend Open Houses

Have you ever heard the term “kick the tires?” It usually applies to car shopping, and refers to not only looking at cars that are available, but sitting in the driver’s seat, trying out the features and even going on a test drive. The same is true when it comes to buying a house. Today, most people search for everything on the web, but a house is a tangible item you want to experience in real life (not just virtually) to get a true sense of what is being offered.

The home buying equivalent of kicking the tires is to walk through houses for sale. The easiest way to do this is by going to open house events. You’ll find them in almost every neighborhood on any given weekend of the year.

Open house means exactly what it says – anyone can come in and look. You should take advantage of that, particularly in any neighborhoods you’re targeting for purchase. This will give you an opportunity to see specific homes in that neighborhood, and may help you decide whether you want to pursue a neighborhood or cross it off your list.

Work With Trusted Professionals

When you’re buying a home, you don’t just need service providers – you need partners. Those are professionals who take their business seriously and have a vested interest in getting you a good deal. This includes your mortgage lender, real estate agent, home inspector and closing agent. Don’t go by price or even by a business that does a lot of advertising. Instead, rely on personal referrals.

Work with the right people and the entire home buying process will be easier and less stressful. In fact, one of the ways to recognize a competent professional is one who can anticipate problems and obstacles. They have a way of preventing small problems from turning into big ones through advanced planning.

Sell Your Current Home Before Buying a New One

Home sellers prefer “clean buyers.” A clean buyer is one who doesn’t have a previous home that needs to be sold before closing on the new property. A lot of people are afraid of being homeless and don’t even bother to sell their home until they have a new one under contract.

That may comfort the buyer, but it’s a serious problem for a seller. It means you can’t close on his home until you sell yours. Maybe that’ll happen in a few days, or maybe it will take a few months. Either way, an anxious seller may not be in a position to wait on your sale.

This becomes particularly important in strong housing markets, where sales often attract multiple bidders. It isn’t always the person who bids the highest that wins. Often, the person whose offer is accepted is the cleanest buyer. They’re essentially ready to close from the moment the contract is accepted.

One option would be to sell your house with a contingency that you will live in it for at least 30 days after the closing. After you close on the sale, that’s when you should begin looking to buy a new home. You’ll enter the market as a clean buyer, with a strong bargaining position as a result.

Home buying is never as easy as they make it seem on television, but follow these tips and you’ll be in your dream home in no time!

This is for informational purposes only. This is not intended as legal or financial advice.

 

PHH Mortgage is joining the Ocwen family!

Ocwen and PHH Mortgage announced today that the merger of the two companies is complete. Their combined operations will create tremendous opportunities for their customers. As a full-service mortgage banking institution with a nationwide footprint, they will offer customers an enhanced portfolio of best-in-class lending and servicing solutions.

The new company will bring a full range of lending solutions to help customers save time and money. They are excited to provide customers with more options to help them reach their financial goals.  Although interest rates have increased this year, they still remain low and it is strongly recommended that customers call before the Federal Reserve raises interest rates again in December.

Customers who have questions about refinancing their mortgage or who are interested in purchasing a new home can speak with a licensed loan officer by calling (800) 210-8849.

 

 

 
 
 
 
 

10 Things to Know Before Refinancing Your Mortgage

You’ve already taken out one loan to buy your home. Why do it again? Because refinancing with a new loan can provide a number of benefits.

Before you get too far along, however, make sure you understand the basics and choose the home refinance solution that matches your unique situation.

  1. Refinancing may lower your monthly payments1Keep an eye on the market and interest rates. Refinancing at the right time – like when interest rates drop one percent or more lower than your current mortgage interest rate – can make a notable difference in your monthly cash flow.
  2. Many other factors affect your interest rate: Generally speaking, lower market interest rates mean you pay less over the life of your loan. But just how low your new refinance interest rate can go depends on many factors, including your credit score, market conditions and mortgage type.
  3. Refinancing may shorten your repayment period but increase your monthly payments: You may find it’s a worthy tradeoff to make higher monthly payments in order to own your home sooner – especially if interest rates are favorable. Your personal financial situation and long-term goals will help determine the right move.
  4. You can refinance to obtain cash: Cash out refinancing allows you to get an additional lump sum of cash right away to use for major purchases, including home improvements, automobiles, vacations or weddings. However, you should compare the benefits of refinancing to other methods, including home equity loans – especially if you don’t need a large amount.
  5. Know what you owe: Determine the payoff amount on your existing mortgage to know how much you will need to borrow from a new loan. Also, find out if your current lender charges any fees or penalties for paying your entire mortgage before it’s due (called prepayment).
  6. You have options: There are numerous loan options out there for your home, ranging from loans that give you a more stable interest rate to those that help consolidate your debt. Work with a lender to determine if any option benefits you more than your current mortgage loan.
  7. Refinancing includes closing: You will need to go through another property appraisal, as well as provide essential documents – which will vary based upon your location and loan option. Closing costs are also involved.
  8. You will need home insurance coverage and a paid receipt for your lender: Most lenders require a paid one-year policy for hazard insurance that covers at least the amount of the mortgage. The lender will be the named mortgagee on the policy.
  9. You have time to change your mind: By law, you have three business days after you sign your loan contract to cancel the loan for any reason. For this same reason, you do not receive any money until three days after signing the contract. This applies to primary residences only.

 

1 By refinancing your existing loan, your total finance charge may be higher over the life of the loan. 

10 Things to Know Before Purchasing Your First Home

 

Buying your first home is a big investment – one that can affect your lifestyle and your credit. The more information gathering you do before making your decision, the greater your satisfaction is likely to be before, during and after your move. To get you started, here are ten things to know before buying your first home.

  1. How much you can afford: Consider all costs involved, including the down payment, closing costs, your monthly mortgage payment, taxes and maintenance, insurance and any applicable association fees.
  2. Your credit score: Credit is an agreement to borrow money with the promise that you will pay it back later through scheduled payments. Good credit may get you a lower rate on your loan. To learn about credit and how to get your score, read our “All About Your Credit” article.
  3. The homebuying process: From the pre-approval decision through inspections and the closing, the homebuying experience involves many steps. Make sure you see the big picture before you start by reviewing the Home Purchase Checklist.
  4. Your financing options: Rates, terms, discount points and other details vary by loan type and with your credit. If you’re ready to take the next steps, find out what’s available to you by calling (800) 210-8849 to discuss your options.
  5. The right real estate agent for you: Real estate agents specialize in a variety of areas and are each familiar with different neighborhoods. Choose one who you feel best aligns with your needs and personal preferences.
  6. The neighborhood: Safety, commute times, noise and other surrounding factors can influence your quality of life. Make sure you visit the area, walk around the neighborhood and get a feel for the community. Take the time to research the community online to learn of any upcoming developments that may impact the housing market in that area, and look for other red flags that may impact your choice to live there.
  7. The school district: Even if you don't have children, you should consider the rating of the school district where you are planning to live. The school district where your home is located will have a direct impact on your taxes. And while low taxes may seem appealing because you don't have children, strong school districts are a top priority for many home buyers, so this can help to boost your property value and your bottom line when you choose to sell. It’s important to weigh the pros and cons for your situation now and in the future.
  8. The state of the market: Is it a buyer’s or a seller’s market? Can you get more house for less if you wait a little longer? Timing can be crucial in determining the total cost of your first home.
  9. Comparable prices: How much do similar homes in the surrounding area cost? You may want to compare houses in several neighborhoods to make sure you’re getting a good value. Ask your real estate agent for information about comparable properties (or “comps”) to determine how much to offer.
  10. How your taxes will change: While home ownership comes with additional expenses like taxes and interest fees associated with your mortgage, you may be able to deduct your mortgage interest and real estate property taxes come tax season. Consult with your tax advisor for details specific to your individual situation.

Ready to get started? Find out more about your financing options, the home-buying process and what you can afford by contacting one of our experienced loan consultants at (800) 210-8849.

Financial Planning for Home Ownership

How much money will you need to buy your home now and support it into the future? Whether you’ve already started hunting or you’re just now considering making the move to home ownership, you’ll need to get your financial house in order first to put yourself in a positive position.

Start the foundation of your plan by figuring out how much you can afford to spend on a new home. You’ll find plenty of tools out there to help you, like affordability or monthly payment calculators. There are several different factors involved with the affordability equation – including some immediate up-front costs, regular monthly payments and the ongoing expenses associated with homeownership. This article explores these factors to help you prepare accordingly.

Get off to a good start

One of the biggest out-of-pocket expenses you’ll need to plan for is your down payment – the part of your property purchase price paid in cash and not financed with a mortgage. The more up-front money you can put down, the less you will pay each month for your mortgage.

The minimum required down payment depends on the mortgage program you select. In general, at least 3.5% of the sale price is required for an FHA or VA mortgage. If you put down less than 20% on a conventional loan, you may need private mortgage insurance – which would add to your monthly payments. When it comes to FHA loans, in addition to lower down payments they typically feature higher qualifying ratios than most conventional mortgages.

Don’t forget that you will also need cash for the closing costs, which cover expenses that complete the transfer of ownership, such as an origination fee, attorney's fee, initial escrow payments and the costs of obtaining title insurance and a survey. Closing costs are typically based on the home price and vary according to location.

Prepare for the long haul

Unless you are paying for your home in cash, your financial plan will need to account for a mortgage payment for a term of your choosing – most likely 15 or 30 years. Your payments are based on both the principal (the amount of the loan) and interest (the amount you pay to borrow money, calculated as a percentage of the amount borrowed).

Payments may also include money held in escrow for property taxes and homeowners’ insurance. You can find out property tax information from the home’s seller or your real estate agent and confirm it with the recording office in the county where your home is located. Property taxes are reassessed from time to time, so this amount may change.

As for your homeowners’ insurance policy, your lender requires the policy to cover the cost to rebuild the home. The insured amount may be higher or lower than the actual purchase price, and your insurance company can give you an estimate based on specific property information.

No financial plan would be complete without full consideration of the “extra” costs of homeownership beyond your mortgage: Utility bills, homeowners’ association dues and routine maintenance all come into play.

Remember the benefits

It’s easy to get overwhelmed by all the costs associated with your home. Try to keep in mind that owning a home also increases your assets, which can open up opportunities for other investments. Once you’re a homeowner, you may be able to use your home’s equity as a secure line of credit for future purchases. In addition, you may be able to deduct your mortgage interest, real estate property taxes and discount points. Consult with a tax advisor for details specific to your situation.

And you can always learn more about your options by talking with one of our experienced loan consultants at (800) 210-8849. 

Borrowing Basics: Home Equity Loans vs. Cash Out Refinancing

You’ve probably heard that owning a home is a smart investment – but  you don’t always have to wait to sell your home to see the returns. You may be able to use the equity in your home right now to borrow money for such expenses as home improvements, automobiles, vacations, college tuition or weddings. You may also be able to consolidate your existing debt – like credit cards or student loans – at a lower interest rate.

As a homeowner, you have two main borrowing options: home equity loans and cash-out refinancing. The option you choose largely depends on your situation and your goals. For instance, do you need money quickly, or are you mainly looking to reduce your monthly payments?

Before you make any decisions, know what’s involved with each option and the differences between them.

Home Equity Loans: Fast and Flexible

Think of a home equity loan like a second mortgage – although typically smaller than a primary mortgage – that comes in two varieties:

  • With a traditional home equity loan, you can borrow a large lump sum of cash and then repay the amount in monthly installments at a fixed interest rate, usually over 10 to 15 years. The interest rate may be higher, though, than a fixed rate home mortgage.
  • home equity line of credit (HELOC) offers a bit more flexibility. It functions like a credit card, but features a lower, variable interest rate. You can draw cash as you need it from a HELOC, and you only pay interest on the amount you borrow.

These home equity borrowing options may work well for you if today’s interest rates are either the same as or lower than your current mortgage interest rate. Home equity loans also tend to result in cash quickly: Lenders can typically approve and fund home equity loans faster than they can refinance your mortgage. As an added bonus, the interest on your home equity loan may be tax deductible, so be sure to consult a tax expert for advice.

Cash Out Refinancing: Borrow Now, Save Later

Cash out refinancing allows you to get extra cash by obtaining a new loan for a balance larger than the one on your existing mortgage. You can then use the cash for anything from home improvements to college tuition. In the end, you will have one new mortgage that covers both your primary home loan and the loan for the additional money.

You may find this option attractive if you’re looking for a considerably large sum of money and a lower mortgage interest rate. If rates are lower than what you pay now by one percent or more, you could notice a positive difference in your monthly cash flow.

Refinancing may also make sense if you want to repay your mortgage over a shorter period of time or if you currently have an adjustable rate mortgage and anticipate interest rates rising. Switching to a fixed rate mortgage may give you more stability at a lower rate.

You also have the ability to refinance your current mortgage without the cash out option – enabling you to take advantage of lower interest rates without increasing your debt.

The Bottom Line on Borrowing

So which choice should you go with? Everything comes back to your short-term needs and long-term goals. If you have questions about your borrowing options or you would like to talk with an experienced loan consultant, call us at (800) 210-8849.