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How do I know how much house I can afford? |
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Generally speaking, you can purchase a home with a value of two or three times your annual household income. However, the amount that you can borrow will also depend upon your employment history, credit history, current savings and debts, the amount of down payment, and other factors. Give us a call, and we can help you determine exactly the amount that will be best for you. |
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What is the difference between a fixed-rate loan, a balloon loan, or an ARM loan? |
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With a fixed-rate mortgage or a balloon, the interest rate remains the same during the initial term of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, typically in relation to an index. While the monthly payments that you make with a fixed-rate mortgage and a balloon are stable for the term selected, payments on an ARM loan will likely change according to the index. Northwestern Bank offers fixed-rate mortgages and 3-year balloons. This allows the monthly payments to remain stable during the term selected, making it easier for you to budget. |
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Q
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How do I know which type of mortgage is best for me? |
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This is one of the many advantages of banking with Northwestern Bank. There is no simple formula to determine the type of mortgage that is best for you. This choice depends on a number of factors, including your current financial picture and how long you intend to keep your house. Our experienced staff can help you evaluate your choices and help you make the most appropriate decision. |
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What does my mortgage payment include? |
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For most homeowners, the monthly mortgage payments include three separate parts:
Principal: Repayment on the amount borrowed
Interest: Payment to the lender for the amount borrowed
Taxes & Insurance: Monthly payments are normally made into a special escrow account for items like homeowner's insurance, private mortage insurance, and property taxes. This Escrow feature is usually optional, but recommended. |
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How much cash will I need to purchase a home? |
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The amount of cash that is necessary depends on a number of items. Generally speaking, though, you will need to supply:
Earnest Money: The deposit that is supplied when you make an offer on the house
Down Payment: A percentage of the cost of the home that is due at settlement
Closing Costs: Costs associated with preparing your mortgage loan
Escrow Money: The initial deposit necessary to pay property taxes and insurances
For special programs - consult with the local housing authority for current offerings |
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Who will I work with at the bank? |
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Generally you will work most closely with one of our experienced lenders from application to closing and beyond. The lender relationship is an important resource for you to call upon as a trusted advisor. If you would like to start this relationship - simply call or e-mail under the "contact us" section. We will be happy to reply regarding any questions that you may have. |
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