Home Loans

To determine the value of the property you are purchasing or refinancing, an appraisal will be required. An appraisal report is a written description and estimate of the value of the property. National standards govern not only the format for the appraisal; they also specify the appraiser's qualifications and credentials. In addition, most states now have licensing requirements for appraisers evaluating properties located within their states.

The appraiser will create a written report for us and you'll be given a copy prior to your loan closing. If you'd like to review it earlier, your Mortgage Loan Officer would be happy to provide it to you.

The appraiser will inspect both the interior and exterior of the home and produce a report that analyses the marketability and value of the property.  In some cases, an abbreviated report may be ordered in which case the cost of the appraisal will be less than if a full appraisal is ordered.  If you are purchasing a new home a full appraisal is normally required.

After the appraiser inspects the property, they will compare the qualities of your home with other homes that have sold recently in the same neighborhood. These homes are called "comparable properties" and play a significant role in the appraisal process. Using industry guidelines, the appraiser will try to weigh the major components of these properties (i.e., design, square footage, number of rooms, lot size, age, etc.) to the components of your home to come up with an estimated value of your home. The appraiser adjusts the price of each comparable sale (up or down) depending on how it compares (better or worse) with your property.

As an additional check on the value of the property, the appraiser also estimates the replacement cost for the property. Replacement cost is determined by valuing an empty lot and estimating the cost to build a house of similar size and construction. Finally, the appraiser reduces this cost by an age factor to compensate for depreciation and deterioration.

If your home is for investment purposes, or is a multi-unit home, the appraiser will also consider the rental income that will be generated by the property to help determine the value.

Using these three different methods, an appraiser will frequently come up with slightly different values for the property. The appraiser uses judgment and experience to reconcile these differences and then assigns a final appraised value. The comparable sales approach is the most important valuation method in the appraisal because a property is worth only what a buyer is willing to pay and a seller is willing to accept.

It is not uncommon for the appraised value of a property to be exactly the same as the amount stated on your sales contract. This is not a coincidence, nor does it question the competence of the appraiser. Your purchase contract is the most valid sales transaction there is. It represents what a buyer is willing to offer for the property and what the seller is willing to accept. Only when the comparable sales differ greatly from your sales contract will the appraised value be very different.

In addition to verifying that your home's value supports your loan request, we'll also verify that your home is as marketable as others in the area. We'll want to be confident that if you decide to sell your home, it will be as easy to market as other homes in the area.

We certainly don't expect that you'll default under the terms of your loan and that a forced sale will be necessary, but as the lender, we'll need to make sure that if a sale is necessary, it won't be difficult to find another buyer.

We'll review the features of your home and compare them to the features of other homes in the neighborhood. For example, if your home is on a 20-acre lot, or has a large accessory building, we'll want to make sure that there are other homes in the area on similar size lots or with similar outbuildings. It is hard to place a value on such unique features if we can't see what other buyers are willing to pay for them. In some areas, additional acreage or outbuildings could actually be a detriment to a future sale. Finding comparable properties can be more challenging in rural areas where it is more difficult to find homes that have similar features.

We'll also make sure that the value of your home is in the same range as other homes in the area. If the value of your home is substantially more than other homes in the neighborhood, it could affect the market acceptance of the home if you decide to sell.

We'll also review the market statistics about your neighborhood. We'll look at the time on the market for homes that have sold recently and verify that values are steady or increasing.

As soon as we receive your appraisal, we'll update your loan with the estimated value of the home. As a standard practice we will provide a copy of your appraisal 3 days prior to closing.

Since the value and marketability of condominium properties is dependent on items that don't apply to single-family homes, there may be some additional steps that will be taken to determine if a condominium meets our guidelines. However, we have an established  track record of financing condominiums as primary, secondary and investment residences.

During the loan process, we'll will carefully review the appraisal to insure that it includes acceptable comparable sales of like properties. Other items may also need to be reviewed during the application approval process and may affect approvability, like homeowners association rules and insurance coverage.

Federal Law requires all lenders to investigate whether or not each home they finance is in a special flood hazard area as defined by FEMA, the Federal Emergency Management Agency. The law can't stop floods. Floods happen anytime, anywhere. But the Flood Disaster Protection Act of 1973 and the National Flood Insurance Reform Act of 1994 help to ensure that you will be protected from financial losses caused by flooding.

We use a third party company who specializes in the reviewing of flood maps prepared by FEMA to determine if your home is located in a flood area. If it is, then flood insurance coverage will be required, since standard homeowner's insurance doesn't protect you against damages from flooding.

The appraisal time can vary depending on the type and location of your property. We order the appraisal as soon as we are certain the loan is approvable and you have expressed your intention to proceed. You will be contacted by the appraiser for access to the property. After that it generally takes between 2 and 3 weeks to receive the final appraisal and the review from our Appraisal Review Department. If you don't hear from the appraiser within seven days of the order date, please inform your Mortgage Loan Officer. If you are purchasing a new home, the appraiser will contact the real estate agent or the seller to schedule an appointment to view the home.

We define manufactured housing as housing units that are factory built with a steel undercarriage that remains as a structural component and limits the structure to a single story. These types of manufactured homes are sometimes known as mobile homes. We do not consider other factory-built housing (not built on a permanent chassis), such as modular, prefabricated, panelized, or sectional housing, to be manufactured housing. If your home is one of these types, please complete the application indicating that your home is a single family home.

In order to qualify for our loan programs a manufactured home must meet the following requirements:

• A manufactured home is any dwelling built on a permanent chassis and attached to a permanent foundation system.
• In order for the home to be considered financeable we required that it be "de-titled" by the county in which it is located.
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• Be a one-family dwelling that is legally classified as real property.
  
  
• The towing hitch, wheels, and axles must have been removed and the home must be permanently attached to a foundation system that meets state and local codes as well as the manufacturer’s requirements.
  
  
• Foundation system must be appropriate for the soil conditions for the site and meet local and state codes.
  
  
• The land on which the manufactured home is situated must be owned by you. We do not provide financing for manufactured homes located on rented or leased land.
  
  
• Must have been built in compliance with the Federal Manufactured Home Construction and Safety Standards that were established June 15, 1976. Generally, compliance with these standards will be evidenced by the presence of a HUD Data Plate that is affixed near the main electrical panel of the home or in another readily accessible and visible location.
  
  
• Must be at least double-width, 24 feet wide, and have a minimum 600 square feet of gross living area. Must be acceptable to typical purchasers in the market area.

An adjustable rate mortgage, or an "ARM" as they are commonly called, is a loan type that offers a lower initial interest rate than most fixed rate loans. The trade off is that the interest rate can change periodically, usually in relation to an index, and the monthly payment will go up or down accordingly.

Against the advantage of the lower payment at the beginning of the loan, you should weigh the risk that an increase in interest rates would lead to higher monthly payments in the future. It's a trade-off. You get a lower rate with an ARM in exchange for assuming more risk.

For many people in a variety of situations, an ARM is the right mortgage choice, particularly if your income is likely to increase in the future or if you only plan on being in the home for three to five years.

Here's some detailed information explaining how ARM's work.

Adjustment Period

With most ARMs, the interest rate and monthly payment are fixed for an initial time period such as one year, three years, five years, or seven years. After the initial fixed period, the interest rate can change perodically. For example, one of our most popular adjustable rate mortgages is a 5/1 ARM. The interest rate will not change for the first five years (the initial adjustment period) but can change every year after the first five years. In the same way a 5/5 ARM will have a fixed rate for five years and will adjust once every 5 years after that.

Index

Our ARM interest rate changes are tied to changes in an index rate. Using an index to determine future rate adjustments provides you with assurance that rate adjustments will be based on actual market conditions at the time of the adjustment. The current value of most indexes is published weekly in the Wall Street Journal. If the index rate moves up so does your mortgage interest rate, and you will probably have to make a higher monthly payment. On the other hand, if the index rate goes down your monthly payment may decrease.

Margin

To determine the interest rate on an ARM, we'll add a pre-disclosed amount to the index called the "margin." If you're still shopping, comparing one lender's margin to another's can be more important than comparing the initial interest rate, since it will be used to calculate the interest rate you will pay in the future.

Interest-Rate Caps

An interest-rate cap places a limit on the amount your interest rate can increase or decrease. There are two types of caps:

1. Periodic or adjustment caps, which limit the interest rate increase or decrease from one adjustment period to the next.

2. Overall or lifetime caps, which limit the interest rate increase over the life of the loan.

As you can imagine, interest rate caps are very important since no one knows what can happen in the future. All of the ARMs we offer have both adjustment and lifetime caps. Please see each product description for full details.


Prepayment Penalties

Some lenders may require you to pay special fees or penalties if you pay off the ARM early. We never charge a penalty for prepayment.

Contact a Mortgage Loan Officer

Selecting a mortgage may be the most important financial decision you will make and you are entitled to all the information you need to make the right decision. Please do not hesitate to contact a Mortgage Loan Officer if you have questions about the features of our adjustable rate mortgages.

There's no cost for completing our application at this time. After your loan is submitted there will be additional costs that you may be asked to pay in advance to proceed. However, most of the costs of the loan will be paid at closing.

After we receive your application your Mortgage loan Officer will contact you to confirm the interest rate and terms. We offer a 55-day courtesy rate lock on our mortgage loans.

None of the loan programs we offer have penalties for prepayment. You can pay off your mortgage any time with no additional charges.

General Statement

The interest rate market is subject to movements without advance notice. We try to honor the rate effective as of the date of application whenever possible, as long as the loan closing occurs within 55 days of a complete application packet.

A lock is an agreement by the borrower and the lender and specifies the number of days for which a loan's interest rate and points are guaranteed. Our courtesy lock period is our commitment to honor the rate we have quoted to you. Should interest rates rise during the 55-day period, we will honor the committed rate as long as there are no changes to the application, collateral or conditions of the loan.

When Can I Lock?

Before you can lock we must first verify your online application and additional documentation. After we have enough information to determine the available interest rate, your Mortgage Loan Officer will contact you to confirm your term and offer you a 55 day courtesy rate lock. 

Fees

We do not charge a fee  for locking in your interest rate.

Lock Period

We currently offer a 55 day lock-in period. This means your loan must close within 55 days from the day your lock is confirmed by us.

Lock Changes

If you choose to lock your rate now but at a later date want to be released to use a different (lower) interest rate a rate lock cancelation fee may be charged.

A home loan often involves many fees, such as the appraisal fee, title charges, closing fees, and state or local taxes. These fees vary from state to state and also from lender to lender. Any lender or broker should be able to give you an estimate of their fees, but it is more difficult to tell which lenders have done their homework and are providing a complete and accurate estimate. We take quotes very seriously. 

To assist you in evaluating our fees, we've grouped them as follows:

Third Party Fees

Fees that we consider third party fees include the appraisal fee, the credit report fee, the settlement or closing fee, the survey fee, tax service fees, title insurance fees, flood certification fees, and courier/mailing fees.

Third party fees are fees that we'll collect and pass on to the person who actually performed the service. For example, an appraiser is paid the appraisal fee, a credit bureau is paid the credit report fee, and a title company or an attorney is paid the title insurance fees.

Typically, you'll see some minor variances in third party fees from lender to lender since a lender may have negotiated a special charge from a provider they use often or chooses a provider that offers nationwide coverage at a flat rate. You may also see that some lenders absorb minor third party fees such as the flood certification fee, the tax service fee, or courier/mailing fees.

Taxes and Recording Fees

These fees will most likely have to be paid regardless of the lender you choose.

Lender Fees

Fees such as points, document preparation fees, and loan processing fees are retained by the lender and are used to provide you with the lowest rates possible. This is the category of fees that you should compare very closely from lender to lender before making a decision.

Required Advances

With most lenders you will be asked to prepay some items at closing that will actually be due in the future. These fees are sometimes referred to as prepaid items. We currently have no requirement to pay future costs like real estate taxes, homeowner's insurance or prepaid interest charges at closing.

If you've ever purchased a home before, you may already be familiar with the benefits and terms of title insurance. But if this is your first home loan or you are refinancing, you may be wondering why you need another insurance policy.

The answer is simple: The purchase of a home is most likely one of the most expensive and important purchases you will ever make. You, and especially your mortgage lender, want to make sure the property is indeed yours: That no individual or government entity has any right, lien, claim, or encumbrance on your property.

The function of a title insurance company is to make sure your rights and interests to the property are clear, that transfer of title takes place efficiently and correctly, and that your interests as a homebuyer are fully protected.

We do not presently require mortgage insurance, which is a protection against additional risk to the lender when a purchaser has less than 20% down payment. However, the terms of your approved loan may be affected if your down payment is less than 20%.

The maximum percentage of your home's value that you can borrow depends on the purpose of your loan, how you use the property, and the loan type you choose. The best way to determine what loan amount we can offer is to complete our online application.

A credit score is one of the pieces of information that we'll use to evaluate your application. Financial institutions have been using credit scores to evaluate credit card and auto applications for many years, but only recently have mortgage lenders begun to use credit scoring to assist with their loan decisions.

Credit scores are based on information collected by credit bureaus and information reported each month by your creditors about the balances you owe and the timing of your payments.

Some of the things that affect your credit score include your payment history, your outstanding obligations, the length of time you have had outstanding credit, the types of credit you use, and the number of inquiries that have been made about your credit history in the recent past.

Using credit scores to evaluate your credit history allows us to quickly and objectively evaluate your credit history when reviewing your loan application. However, there are many other factors when making a loan decision and we never evaluate an application without looking at the total financial picture of the applicant.

An abundance of credit inquiries can sometimes affect your credit scores since it may indicate that your use of credit is increasing.

But don't overreact! The data used to calculate your credit score doesn't include any mortgage or auto loan credit inquiries that are made within the 30 days prior to the score being calculated. In addition, all mortgage inquiries made in any 14-day period are always considered one inquiry. Don't limit your mortgage shopping for fear of the effect on your credit score.

There is no charge to you for the credit information we will access with your permission to evaluate your application online. You will only be charged for a credit report if you decide to complete the application process after your loan is approved.

Whether you're purchasing or refinancing, we are certain you'll find our service amazing.

If you will be purchasing but haven't found the perfect home yet, complete our application and we will issue a pre-approval for a mortgage loan now with no obligation.

In some cases you can borrow funds to use as your down payment.  However, any loans that you take out must be secured by an asset that you own. If you obtain a loan for the down payment the new monthly expense will be used in determining your debt ratios.

Generally, the income of self-employed borrowers is verified by obtaining copies of personal (and business, if applicable) federal tax returns for the most recent three-year period. 

We'll review and average the net income from self-employment that's reported on your tax returns to determine the income that can be used to qualify. We won't be able to consider any income that hasn't been reported as such on your tax returns. Typically, we'll need at least one, and sometimes a full two-year history of self-employment to verify that your self-employment income is stable.

In order for bonus, overtime, or commission income to be considered, we will need to verify you have a history of receiving it and it must be likely to continue. Acceptable verification may be in the form of W-2 statements, pay stubs or a verification of employment form signed by your employer, The regulations tell us to average the amounts you have received over the past two years to calculate the amount that can be considered as a regular part of your income.

If you haven't been receiving bonus, overtime, or commission income for at least one year, it may not be given full value when your loan is reviewed for approval.

We will ask for copies of a benefit notification letter together with a bank statement if your pension or retirement income is deposited directly in your bank account. Sometimes it will also be necessary to verify that this income will continue for at least three years since some pension or retirement plans do not provide income for life. This can usually be verified with a copy of your award letter.

Yes, applying for a mortgage loan before you find a home may be the best thing you could do.  If you apply for your mortgage now, we will issue a pre-qualification letter subject to you finding property that meets your requirements. We will issue a pre-qualification once the application and documentation is reviewed and pre-approved. You can use the letter to assure real estate brokers and sellers that you are a qualified buyer.

When you find the perfect home, you should call your Mortgage Loan Officer to complete your application. You will then be able to lock your interest rate we will complete the processing of your request.

Generally, only income that is reported on your tax return can be considered when applying for a mortgage, unless the income is legally tax-free and isn't required to be reported. In that case, we will require additional verification of the income in the form of a benefit notification letter.

If you own rental properties, we will review the Schedule E of your tax returns to verify your rental income, after all expenses except depreciation. Since depreciation is only a paper loss, it won't be counted against your rental income.

If you haven't owned the rental property for a complete tax year, we'll ask for a copy of any leases you've executed and we'll estimate the expenses of ownership.

Generally, personal tax returns are required to verify the amount of your dividend and/or interest income so that an average of the amounts you receive can be calculated. In addition, we may need to verify your ownership of the assets that generate the income by obtaining copies of statements from your financial institution, brokerage statements, stock certificates or promissory notes.

Typically, income from dividends and/or interest must be expected to continue for at least three years to be considered for repayment.

Information about child support, alimony, or separate maintenance income does not need to be provided unless you wish to have it considered for repaying this mortgage loan.

Typically, income from a second job will be considered if a one-year history of secondary employment can be verified.

First,  please complete our online application.

The application will ask you questions about the home and your finances and takes less than 20 minutes to complete. After completing your application, a Mortgage Loan Officer will contact you to answer any questions you might have. Your Mortgage Loan Officer will ask for additional information needed to make a decision about your loan and will advise you on the various products available to you.

We will send you an application and disclosure package.

The application package will be sent to you via email or regular mail and will contain papers for you to sign as well as a list of items we'll need to verify the information you provided about your finances during the online application.

We will order the appraisal from a licensed appraiser who is familiar with home values in your area. Depending on your finances and the loan amount requested, different types of appraisals are used. Sometimes the appraiser will need to provide a full report but many times they will do an abbreviated report which is quicker and less expensive.

Title insurance will be necessary. If you're purchasing a home, we'll work with the real estate broker or seller to ensure the title work is ordered as soon as possible. If you are refinancing we'll take care of ordering the title work for you. We'll use the title insurance to confirm the legal status of your property and to prepare the closing documents.

We will contact you to coordinate your closing date.

After we receive the signed application package back from you and the appraisal and title work, we will contact you to schedule your loan closing. If you are purchasing a home, we will also help coordinate the closing with the real estate broker and the seller.

The closing will take place at a Whitefish Credit Union branch office or at a title company who will act as our agent. A few days before closing, your Mortgage Loan Officer will contact you to walk through the final information so that there won't be any surprises at closing.

We look forward to working with you on your home loan!

Having changed employers frequently may not be a hindrance to obtaining a new mortgage loan, particularly if you made employment changes without being unemployed for significant periods of time. We will also look at your income advancements as you have changed employment.

If you're paid on a commission basis, a recent job change may be an issue since we'll have a difficult time of predicting your earnings without a history with your new employer.

If you were in school before your current job, enter the name of the school you attended and the length of time you were in school in the "length of employment" fields. You can enter a position of "student" and income of "0."

A letter from the gift giver may be required stating the funds are a gift , not a loan to be repaid. Gifts are an acceptable source of down payment, if the gift giver is related to you or your co-borrower. We'll ask you for the name, address, and phone number of the gift giver, as well as the donor's relationship to you. The funds must be verified prior to closing.

If you're selling your current home to purchase your new home, we will ask you to provide a copy of the settlement or closing statement you'll receive at the closing to verify that your current mortgage has been paid in full and that you'll have sufficient funds for our closing. Often the closing of your current home is scheduled for the same day as the closing of your new home. If that's the case, we'll just ask you to bring your settlement statement with you to your new mortgage closing.

Congratulations on your new job! If you will be working for the same employer, complete the application as such but enter the income you anticipate you'll be receiving at your new location.

If your employment is with a new employer, complete the application as if this were your current employer and indicate that you have been there for one month. The information about the employment you'll be leaving should be entered as a previous employer. We'll sort out the details after you submit your loan for approval.

Generally, a co-signed debt is considered when determining your qualifications for a mortgage. If the co-signed debt is affordable according to your debt ratios we will not need to do anything more. Otherwise we may be able to disregard the monthly payment of the co-signed debt if you can provide verification that the other person responsible for the debt has made the required payments. We will need to see copies of cancelled checks or other proof of payment for the last 12 months.

Yes, include any student loan that will go into repayment within the next six months. If you are not sure exactly what the monthly payment will be at this time, enter an estimated amount.

Student loans that will not go into repayment in the next six months may need to have the payment deferred status verified.

If you've had a bankruptcy or foreclosure in the past, it may affect your ability to get a new mortgage. Unless the bankruptcy or foreclosure was caused by situations beyond your control, we will generally require that three years have passed since the bankruptcy or foreclosure. It is also important that you've re-established an acceptable credit history with new loans or credit cards.

An installment debt is a loan that you make payments on, such as an auto loan, a student loan or a debt consolidation loan. Do not include payments on other living expenses, such as insurance costs or medical bill payments. 

The closing will take place at a branch office of the Whitefish Credit Union or at a title company who will act as our agent. If you are purchasing a new home, the seller may also be at the closing to transfer ownership to you.

During the closing you will be reviewing and signing several loan papers. The closing agent conducting the closing will be able to answer your questions or feel free to contact your Mortgage Loan Officer if you prefer.

Your Mortgage Loan Officer will contact you a few days before closing to review your final fees, loan terms and the total amount of any funds due at closing.

The most important documents you will be signing at the closing include:

HUD-1 Settlement Statement

This document provides an itemized listing of the final fees charged in connection with your loan. If your loan is a purchase, the settlement statement will also include a listing of any fees related to the transaction between you and the seller. If this loan is a refinance, the settlement statement will show the pay off amounts of any mortgages that will be paid in full with your new loan. Most items on the statement are numbered according to a standardized system used by all lenders. These numbers will correspond to the numbers listed on the Good Faith Estimate that will be provided in your application package. This document is also commonly known as the closing statement and both the buyer and seller must sign this document.

Truth-in-Lending Statement (TIL)

This document provides full written disclosure of the terms and conditions of a mortgage, including the annual percentage rate (APR) and other fees. It is exactly the same as the TIL that you received immediately after your initial application, except it has been updated to reflect the final rate and fee information. Federal law requires that all lenders provide you with this document at closing.

Note

This document is your promise to repay your mortgage loan. The note will provide you with all of the details of your loan including the interest rate and length of time to repay the loan. It also explains the penalties that you may incur if you fall behind in making your payments.

Mortgage / Deed of Trust

This document pledges a property to the lender as security for repayment of a debt. Essentially this means that you will give your property up to the lender in the event that you cannot make the mortgage payments. The Mortgage restates the basic information contained in the note, as well as details the responsibilities of the borrower. In some states, the document is called a Deed of Trust instead of a Mortgage.

If your loan is a refinance, Federal Law requires that you have three days to decide positively that you want a new mortgage after you sign the documents. This means that the loan funds won't be disbursed until three business days have passed. The closing agent will provide more details at the closing.

The most important documents you will sign at closing are the note and mortgage, sometimes called the deed of trust. Unless there are special circumstances, these documents are usually prepared one to two days before your closing. Other documents are prepared by the closing agent the day before or the day of your closing. If you would like copies of the completed documents to be sent to you after they are prepared, please contact your Mortgage Loan Officer.

Please contact your Mortgage Loan Officer  prior to closing to talk about your final documents and to provide a final breakdown of your closing fees as well as the details of the closing. In some cases the Mortgage Loan Officer will be present, but if not the closing agent can answer most questions during the closing.  You may ask them to contact your Mortgage Loan Officer by phone during the closing if you feel you do not have the answers you need.

If you won't be able to attend the loan closing, contact your Mortgage Loan Officer to discuss other options. In many cases, the closing agent is able to mail you the documents in advance so that you can sign them and send them back to the title company. Or, if someone you trust is able to attend on your behalf, you can execute a Power of Attorney so that this person can sign documents as your attorney-in-fact.

In some cases the closing will take place in one of our own branch offices, but otherwise we use local title companies to conduct our loan closings. We will try to schedule your closing in a location that is convenient for you.

If the closing is at a title company we will deliver our loan documents to the closing agent and wire transfer your loan funds prior to closing so that they'll have plenty of time to prepare for your closing.

Automated monthly payments are available. Be sure to discuss automatic payments with your Mortgage Loan Officer and automated payment application will be provided at closing. 

In some cases the closing will take place in one of our own branch offices, but otherwise we use local title companies to conduct our loan closings. We will try to schedule your closing in a location that is convenient to you.

If the closing is at a title company we will deliver our loan documents to the closing agent and wire transfer your loan funds prior to closing so that they'll have plenty of time to prepare for your closing.