General Questions

How much can I borrow?

The amount you can borrow will depend on many variables such as income, type of income, term of the loan, down payment and more. The industry does give a guideline and is called a back-end debt to income ratio. As a very simple explanation you would take your gross income and divide by 12 months for a monthly amount. Then you take this number and multiply by .43. The remaining number must be enough to cover the existing debt on the credit report plus the new house payment including taxes and insurance.

Can I pay off my loan early?

Gem Home Loans does not do any residential mortgage that has a pre-payment penalty, pay off as quickly as you like.

Which is better a pre-qualification or a pre-approval when shopping for a home?

The answer is…..it depends. If it is early in your home buying process and generally a pre-qualification conversation with your loan professional is a good start. A pre-qualification conversation will include questions that review your 4 primary qualification categories (hyper link to other FAQ?). As you begin working with your real estate agent, looking at homes, or most definitely by the time you want to make an offer you will want a full pre-approval.

What are the 4 primary qualification categories?

Debt to income ratio. This is a review of gross mortgage qualifying income vs current debt + the new house payment
History is twofold, wok history and housing history
- As general guidance you will want to be employed for two years in a consistent fashion. There are variances to this and some of them are if you are/were a student, self-employed, and more.
- Regarding housing history, you will want to be able to show a clean rental or home payment history for at least a year, the longer strong history that can be shown the better for qualifying
Assets/Down payment/Reserves. There are dozens of programs that have a varying down payment. As a very general statement most programs will require at minimum a 3-5% down payment. But this general guidance could vary based upon mortgage program, community/DPA assistance, having served in the military and much more.
As it goes in lending the obvious statement is the higher the credit scores the better. With the previous said there are mortgage programs that provide opportunities to buy a home with a credit score down to 540 and in some cases even lower. Typically the target score is 620 to be eligible for most mortgage programs.
Questions on qualifying – click here and we will be in touch

Do I need an appraisal to get a home loan?

The very general answer is yes. But, with that said and in today’s technology world appraisal waivers also known as property inspection waivers are becoming more and more common. Gem Home Loans has relationships with dozens of lenders and can often pre run the homes address to determine the probability that an appraisal will not be needed. Appraisal waivers are most common on refinances but are starting to become more prevalent on home purchases.

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

While you do not have to sell your home before applying for a new mortgage, it will affect your eligibility based on your debt-to-income ratio, as well as affect how much money you have to put down on a new home or if a seller accepts your offer.

How can I get a copy of my credit report?

To obtain a copy of your credit report, visit annualcreditreport.com or call 1-877-322- 8228. The law allows you to order one free copy of your report from each of the nationwide consumer reporting companies every 12 months. Reviewing your credit report prior to applying for a mortgage will give you the opportunity to identify and resolve any credit issues or discrepancies.

What is a cash out refinance?

This is a loan program that will allow you to tap the equity in your home. The cash out can be used for nearly endless possibilities but the most common are to pay off a second mortgage, consolidate other high interest rate debt, do home improvements, additions, remodeling, or to fund a college educations, new businesses and more.

What is a pre-approval?

Pre-approval is a “deeper” process then a pre-qualification. It will include review of paystubs, asset statements, sometimes tax returns and will involve pulling a full credit report. With this information your loan professional can submit the information to automated underwriting systems and can start to give you a very solid range of loan amount that you can be approved for. Through the pre-approval process you will be given a letter that endorses your strength as a home shopper and buyer to your agents and seller.

Tell me about closing costs!

This topic has many variables and they will change based upon the type of home loan program that is being used. The following is a laundry list of costs you could run into when completing a mortgage; underwriting, processing, tax service, flood certificate, title insurance, closing, transfer taxes (on purchases) recording. Some lenders will charge points, origination fees, and more. Typically, closings costs are regulated by numerous regulations. There are no closing cost programs and these will typically come at a higher interest rate.

On a loan estimate you will also have a section regarding escrows. These are not costs. This is for homeowner’s insurance, property taxes, and interest calculated from the time of closing until your first payment.

We would very much like to give you a dollar amount but there are so many variables and programs that can change this number. As very general guidance closings costs could one to four percent of your loan amount.

For a specific consultation use the following link and we will be in touch.

How long does it take to get a home loan?

The process has many factors. To name a few appraisers, underwriters, processors, title companies and so many more play a part of completing your home buying or refinancing process. The key to keep the time frame as short as possible is to always respond quickly and completely to paperwork and loan requests. Make sure you select a loan professional that is responsible to you and efficient in completing tasks. Generally at Gem Home Loans we are closing loans in 15-20 days.

How does my credit score impact my ability to get a home loan?

Credit, also known as your FICO score, is one of the four primary qualifications (hyper link to the 4 primary qualifications). The general answer is the better the credit the more programs that you are eligible for. There are terrific mortgage programs for scores that are not above 700 and these too come with very good interest rates. The target score is 620 but there are mortgage programs for scores down to 540.

Why Brokers Are Better

Why select a mortgage broker over a “big box” bank?

What is a mortgage broker? We are licensed, insured, and trained professionals with access to dozens of lenders and hundreds of programs. We do not have our hands tied by one interest rate, working with one set of guidelines and the constraints of one process. We have the ability to take your specific home lending need and shop for the best program, rates, costs, timeframes and so much more. A mortgage broker is worth his or her weight in gold. They provide a critical service when it comes to navigating your home loan options and because of this our profession is heavily regulated. Every state has their licensing requirements and all mortgage brokers are licensed, insured, bonded, and act with your fiduciary interests in mind.

We are a trusted resource for your credit score questions, property investments loans information, down payment coaching, and so much more.

Responsibilities of Mortgage Brokers

A mortgage broker is worth his or her weight in gold. They provide a critical service when it comes to navigating your home loan options. Our profession is heavily regulated, every state has their licensing requirements, but all mortgage brokers are trained, bonded, and act with your fiduciary interests in mind.

Mortgage brokers and loan officers help you in other ways too! Consider them a trustworthy source for your credit score questions, property investment loan info, down payment planning, and much more.

What types of loans do you do?

The best answer to this question is we do refinancing, home purchase, renovation, and construction loans. Reverse mortgage and some commercial lending coming soon! We have dozens of programs that could be used for each type of loan previously listed. As a broker we have dozens of lenders/banks and each of them have dozens or programs leading to an endless supply of solutions, we will work with you to find the best one.

Working Together for Your Best Home Buying Interests

Buying a home is critical life decisions and investments you will ever make. That’s why we’re dedicated to guiding you through the initial process home loan applications and keep you in the loop every step of the way. Whether you are already working with a real estate agent or are looking for a trusted recommendation, we are ready to team up with you to make your home ownership dreams come true.

Why Gem Home Loans

Why Choose Gem Home Loans?

Even though many focus on numbers, rates, terms, and liabilities, we focus on you. This is the major difference at Gem Home Loans. We know this process can be confusing, time-consuming, and frustrating. Reducing fear and clearly explaining your options is why so many people in Michigan are putting their trust in us.

A team that takes pride in their efficient, timely, and courteous service
Knowledgeable staff with a positive attitude and a “Make It Happen!” philosophy
Advanced financial technology tools that are exceptionally user-friendly
Customized loan products that are developed with today’s unique financing needs in mind
A higher standard of service, reliability, and professionalism

We appreciate your trust in us!

Where are you located?

We are located at 71 Walnut Blvd, Suite 204, Rochester, MI 48307

248.318.2394

[email protected]

This is just our home office we service the entire state of Michigan.

Do you charge for your services?

We do not charge you for our services we are compensated by the lender that we work with. Due to regulations each lender pays us similarly making our goal the same as yours — find the best solution possible! We of course will accept your happiness and referrals as the best payment!

General Questions

Why Brokers Are Better

Why Gem Home Loans

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