I am looking to refinance my home loan. Should I choose a 15 or 30 year loan?

The answer depends on your situation. The 30-year loan will have lower payments required and thus will be easier to obtain and make payments. On the other hand, the 15 year home loan will likely have a lower interest rate, which will be beneficial. Furthermore, the 15-year loan will be paid off in half of the time and will save you considerable money over the life of the loan.  Keep in mind, however, 15-year loans usually have higher payments, so be sure the proposed payment fits into your budget.

I want a low as rate as possible. Should I choose a variable loan (ARM), or a fixed rate loan?

The advantage of a variable rate loan is that the initial interest rate is lower. However, if interest rates increase, then you could end up paying more. One in-between program would be an “Intermediate” ARM, which is set at a lower fixed rate for 1,3, or 5 years, and becomes variable for the remainder of the loan.

I have had some problems with my credit such as prior late payments on a mortgage and an overdue credit card account. Can I still get a loan?

Very few people have perfect credit. Often there are errors on a credit report that can be “cleaned up” so it will not inhibit you in getting a loan. Each situation is different and prior bad credit even prior bankruptcy does not necessarily bar you from getting a home loan.

Can’t I just go to a bank for a loan? Don’t they have loan officers or mortgage bankers there?

Banks certainly make some loans to the public. However, banks may be limited to a narrow choice of programs. A mortgage banker can choose from a variety of programs to provide the loan package that may be more suited (and more competitive) for the customer.

How long will it take for my loan to be processed once I apply?

The answer depends on the lending institution you are using as well how organized you are in getting your documentation organized. A loan can usually be completed between 30 and 45 days after applying. Starting the process early and getting pre-qualified can save you a great deal of time.

Does it cost more to go to a Mortgage Banker, as opposed to a Bank?

A Mortgage Banker should be able to obtain a more competitive rate, without adding any “junk fees”. It is a good idea to inquire with the Mortgage Banker you are meeting to make sure you are not paying any extra fees, compared to a typical bank’s fees, such as unnecessary application or processing fees.

Where can I get more information or get pre-qualified and start the loan process?

Call the Bjornson team at Fairway Independent Mortgage at (360) 676-9600. We’ll take the time to understand your situation and your goals to help you find the best way to proceed.

This information is solely advisory and should not be substituted for legal financial or tax advice. Any and all financial decisions and actions should be done through the advice and counsel of a qualified attorney, financial advisor, and/or CPA. We cannot be held responsible for actions you may take without proper financial, legal or tax advice.