Mortgage Loan Center

 

Whether you're looking to purchase or refinance your home, we can help.

• Competitive closing costs 
• Low or no down payment programs
• Competitive rates - fixed and adjustable 
• Easy application process
• Pre-approvals within 48 hours

New! Use our new online mortgage service to apply, get approved, view rates, use calculators, and more!

Read about the new First-Time Home Buyer Tax Credit

For more information or for current rates, please contact Courtni Bayes at 597- 2814 or cbayes@oucu.org.

OHFA HOMEBUYER PROGRAMS

OUCU and the Ohio Housing Finance Agency (OHFA) can make buying a home more affordable. The OHFA program qualifies low to moderate income homebuyers by offering a below-market interest rate.

Home Buyer Program Features

• Low 30-year fixed interest rate
• Option of down payment assistance grant and a second mortgage at 4% of first mortgage amount
• 1 percent origination
• zero discount points
• Less than perfect credit histories and nontraditional credit accepted

Ohio Heroes Mortgage Program

The Ohio Housing Finance Agency is making $25 million available on a first-come, first-served basis.

Ohio Heroes Mortgage Program is an affordable, fixed-rate financing to low- and moderate-income households in which at least one member is in a qualifying profession.

Rate:  .25% below the OHFA’s First-Time Homebuyer Program, fixed rate
Term: 30 years
Down Payment Assistance Grant:  Borrowers may qualify for two percent of the sales price.
Qualifications:  Must meet qualifications for both OHFA’s First-Time Homebuyer and Ohio Heroes program.
Qualifying professions:  See us for details. Professions include Active Military and Veterans, Firemen/Emergency Medical Technicians/Paramedics, Healthcare Workers, Police Officers, Teachers

Loans are available on a fair and equal basis regardless of race, color, ancestry, national origin, sex, or physical handicap. For more information on these programs and to see if you qualify, contact Courtni Bayes at 597- 2814 or cbayes@oucu.org.

"Home Loan Payment Relief" HLPR Loan (pronounced "helper")

The HLPR loan was designed to create homeownership opportunities for those of modest means. The interest rate is 1% below the national average for these types of loans, and would currently be about 4.625%. The rate changes so please call us for the most recent rate. Rate adjustments are capped at 1% per year and 5% over the life of the loan. Because of the low interest rate, members will be able to qualify for mortgage loans more easily.

• low minimum down payment required
• 3/1 ARM
• borrowers eligible for this program would need to be at or below 100% of the area's median income established by HUD, currently $50,000
• underwritten and serviced right here at OUCU

The Federal Home Loan Bank of Cincinnati (FHLBC)

We can now offer the FHLBC "Welcome Home" program which provides down payment and closing cost assistance for owner-occupied housing.

• grants up to $5,000
• borrowers must be at or below 80% of the median income established by the state housing agency
• allowable annual income for family of 3 or more in Athens is currently $64,904

Free Annual Credit Report

www.annualcreditreport.com is a centralized service for consumers to request free credit file disclosures (commonly called credit reports). Under the Fair and Accurate Credit Transactions Act (FACT Act) consumers can request and obtain a free credit report once every 12 months from each of the three nationwide consumer credit reporting companies, Equifax, Experian and TransUnion.

This website offers consumers a fast and convenient way to request, view, and print their credit reports in a secure Internet environment. Consumers can also request reports by telephone and by mail. www.annualcreditreport.com is the only service authorized by Equifax, Experian and TransUnion for this purpose.

Please note that, as a security precaution, consumers should never provide their personal information to any other company or person in connection with requesting free annual credit reports under the FACT Act. AnnualCreditReport.com will not approach consumers via email, telemarketing or direct mail solicitations. You will not get a "credit score" with these free reports. A credit score is a complex mathematical model that evaluates many types of information in a credit file. It is used by many lenders, including OUCU, to help determine whether a person qualifies for a particular credit card, loan, or other service. A report with your credit score can be purchased through the credit reporting agencies or through OUCU's website cllick on "online services" then personal credit report.

Glossary of Terms

Adjustable-Rate Mortgage (ARM): Also known as a variable-rate loan, usually offers a lower initial rate than fixed-rate loans. The interest rate can change at specified time periods based on changes in an interest rate index that reflects current finance market conditions, such as the LIBOR index or the Treasury index. The ARM promissory note states maximum and minimum rates. When the interest rate on an ARM increases, the monthly payments will increase and when the interest rate on an ARM decreases, the monthly payments will be lower.

Amortization: A term used to describe the process of paying off a loan over a predetermined period of time at a specific interest rate. The amortization of a loan includes payment of interest and a portion of the outstanding principal balance during each payment cycle.

Annual Percentage Rate (APR): The cost of credit expressed as a yearly rate. The APR includes the interest rate, points, broker fees and certain other credit charges that the borrower is required to pay.

Application Fee: The fee that a mortgage lender charges to apply for a mortgage to cover processing costs.

Appraisal: A professional analysis, including references to sales of comparable properties, used to estimate the value of the property.

Appreciation: An increase in the market value of a home due to changing market conditions and/or home improvements.

Assets: Everything of value an individual owns.

Balloon Mortgage: A mortgage with monthly payments based on a 30-year amortization schedule and the unpaid principal balance due in a lump sum payment at the end of a specific period (usually 5 or 7 years) earlier than 30 years. The mortgage contains an option to reset the interest rate to the current market rate and to extend the maturity date provided certain conditions are satisfied.

Capacity: Your ability to make your mortgage payments on time. This depends on your income and income stability, your assets and reserves, and the amount of your income each month that is available after you have paid for your housing costs, debts and other obligations.

Closing (Closing Date): When the real estate transaction between buyer and seller is completed. The buyer signs the mortgage documents and the closing costs are paid. Also known as the settlement date.

Closing Agent: A person that coordinates closing-related activities, such as recording the closing documents and disbursing funds.

Closing Costs: The costs to complete the real estate transaction. These costs are in addition to the price of the home and are paid at closing. They include points, taxes, title insurance, financing costs and items that must be prepaid or escrowed and other costs. Ask a lender or real estate professional for a complete list of closing cost items.

Collateral: Property which is pledged as security for a debt. In the case of a mortgage, the collateral would be the land, the house, and other buildings and improvements.

Commitment Letter: A letter from your lender that states the amount of the mortgage, the number of years to repay the mortgage (the term), the interest rate, the loan origination fee, the annual percentage rate and the monthly charges.

Credit: The ability of a person to borrow money, or obtain goods with payments over time, as a consequence of the favorable opinion held by a lender as to the person's financial situation and reliability.

Credit Bureau: A company that gathers information on consumers who use credit and sells that information in the form of a credit report to credit lenders.

Credit History: A credit history is a record of credit use. It is comprised of a list of individual consumer debts and an indication as to whether or not these debts were paid back in a timely fashion or "as agreed." Credit institutions have developed a complex recording system of documenting your credit history. This is called a credit report.

Credit Score: A computer-generated number that summarizes an individual's credit profile and predicts the likelihood that a borrower will repay future obligations.

Creditworthy: Your ability to qualify for credit and repay debts.

Debt-to-Income Ratio: The percentage of gross monthly income that goes toward paying for your monthly housing expense, installment debts, alimony, child support, car payments, and payments on revolving or open-ended accounts such as credit cards.

Deed: The legal documents conveying title to a property

Default: Failure to perform a legal obligation; a default includes failure to pay on a financial obligation, but may also be a failure to perform some action or service that is non-monetary.

Down Payment: A portion of the price of a home, usually between 3-20%, not borrowed and paid up front.

Equity: The value in your home above the total amount of the liens against your home. If you owe $100,000 on your house but it is worth $130,000, you have $30,000 of equity.

Escrow: The holding of money or documents by a neutral third party prior to closing. It can also be an account held by the lender (or servicer) into which a homeowner pays money for taxes and insurance.

Fixed-Rate Mortgage: A mortgage with an interest rate that does not change during the entire term of the loan.

Foreclosure: A legal action that terminates all ownership rights in a home when the homebuyer fails to make the mortgage payments or is otherwise in default under the terms of the mortgage.

Gift Letter: A letter that a family member writes verifying that he/she has given you a certain amount of money as a gift and that you do not have to repay it. You can use this money towards a portion of your down payment through some mortgage products.

Good-Faith Estimate: A written statement itemizing the approximate costs and fees for the mortgage.

Gross Monthly Income: The income you earn in a month before taxes and other deductions. Under certain circumstances, it may also include rental income, self-employed income, income from alimony, child support, public assistance payments, and retirement benefits.

Home Inspection: A professional inspection of a home to review the condition of the property. The inspection should include an evaluation of the plumbing, heating and cooling systems, roof, wiring, foundation and pest infestation.

Homeowner's Insurance: A policy that protects you and the lender from fire or flood, which damages the structure of the house; a liability, such as an injury to a visitor to your home; or damage to your personal property, such as your furniture, clothes or appliances.

HUD-1 settlement statement: A final listing of the costs of the mortgage transaction. It provides the sales price, and down payment, as well as the total settlement costs required from the buyer and seller.

Index: The published index of interest rates on a publicly traded debt security used to calculate the interest rate for an ARM. The index is usually an average of the interest rates on a particular type of security such as the LIBOR.

Interest: The cost you pay to borrow money. It is the payment you make to a lender for the money it has lent to you. Interest is usually expressed as a percentage of the amount borrowed.

Liabilities: Your debts and other monetary obligations.

Lien: A claim or charge on property for payment of some debt. With respect to a mortgage, it is the right of the lender to take the title to your property if you do not make the payments due on the mortgage.

Loan Origination Fees: The fee paid to your mortgage lender for processing the mortgage application. This fee is usually in the form of points. One point equals 1% of the mortgage amount.

Lock-in rate: A written agreement guaranteeing a specific interest rate when your mortgage closes.

Low-Down-Payment Feature: A feature of a mortgage, usually a fixed-rate mortgage that helps you buy a home with as little as a 3% down payment.

Market Value: The current value of your home based on what a willing purchaser would pay. The value determined by an appraisal is sometimes used to determine market value.

Mortgage: A loan secured by a lien on your home. In some states the term mortgage is also used to describe the document you sign to show that you have granted the lender a lien on your home; other states use a deed of trust document instead of a mortgage. It may also be used to indicate the amount of money you borrow, with interest, to purchase your house. The amount of your mortgage is usually the purchase price of the home minus your down payment.

Mortgage Insurance (MI or PMI): Insurance needed for mortgages with low down payments (usually less than 20% of the price of the home).

Mortgage Lender: The lender providing funds for a mortgage. Lenders also manage the credit and financial information review, the property and the loan application process through closing.

Mortgage Rate: The cost or the interest rate you pay to borrow the money to buy your house.

Net Monthly Income: Your take-home pay after taxes. It is the amount of money that you actually receive in your paycheck.

Offer: A formal bid from the homebuyer to the home seller to purchase a home.

Points: 1% of the amount of the mortgage loan. For example, if a loan is made for $50,000, one point equals $500.

Pre-approval Letter: A letter from a mortgage lender indicating that you qualify for a mortgage of a specific amount. It also shows a home seller that you are a serious buyer.

Pre-qualification letter: A letter from a mortgage lender that states that you are pre-qualified to buy a home but does not commit the lender to a particular mortgage amount.

Principal: The amount of money borrowed to buy your house or the amount of the loan that has not yet been paid back to the lender. This does not include the interest you will pay to borrow that money. The principal balance (sometimes called the outstanding or unpaid principal balance) is the amount owed on the loan at any given time. It is the original loan amount minus the total repayments of principal you have made to date.

Private Mortgage Insurance: see Mortgage Insurance

Refinance: Obtaining a new mortgage with all or some portion of the proceeds used to pay off the original mortgage.

Securities: A financial form that shows the holder owns a share or shares of a company (stock) or has loaned money to a company or government organization (bond).

Title: The right to, and the ownership of, land by the owner. Title is sometimes used to mean the evidence or proof of ownership of land; although another term used for that is "deed."

Title Insurance: Insurance that protects lenders and homeowners against loss of their interest in the property because of legal problems with the title.

Truth-in-Lending Act (TILA): Federal law that requires disclosure of a truth in lending statement for consumer loans. The statement includes a summary of the total cost of credit such as the APR and other specifics of the loan.

Underwriting: The process a lender uses to determine loan approval. It involves evaluating the property and the borrower's credit and ability to pay the mortgage.

Housing: Should You Buy or Rent?

If the thought of owning a home is appealing, you're not alone. Low interest rates are making the leap into home ownership attractive--and possible--for more consumers than ever before.

But owning isn't for everyone. Some people would rather leave the yard work to the landlord, and like being mobile or close to vital downtown areas where work and play are a short walk away.

Which option is best for you? Here's some information to help you determine whether buying or renting works better for your immediate needs and your pocketbook.

When it comes to buying:

• You can deduct from federal taxes the interest and local property tax portions of each mortgage payment you make. (Note, however there's a maximum loan amount of $1 million--$500,000 if married filing separately--that qualifies for an interest deduction.) If you're in the 28% tax bracket, the government underwrites $280 for every $1,000 of deductible interest and taxes. Plus, because you must itemize deductions on your tax return to benefit from the mortgage deduction, you can reduce your tax bill further with charitable contributions and other deductions that don't see the light of day when you use the standard deduction.

• With each payment you build equity, or the financial stake you have in your house, and increase your net worth. As your house's value appreciates through improvements you've made or changes in the market, your equity grows in stride.

When it comes to renting:

• Lower monthly payments will help you sock away money for the one-two financial punch of a down payment--which typically runs between 5% and 20% of the house's price--and closing costs-which typically run between 3% and 6% of the house's price.

• If you know your family is going to grow, it may be better to continue renting until you save up for a house you won't outgrow before you recoup your expenses, which typically takes five to seven years.

• It may be your best bet if your job may require you to move in a couple years.

As you weigh renting vs. buying and face what may be the biggest financial decision of your life, give equal consideration to your personal preferences as well as the dollars and cents. For information about our low mortgage rates and savings accounts to help you save for that down payment or other goals, contact Courtni Merckle at (740) 597-2814 or (800) 562-8420 ext.72814. Her email address is cbayes@oucu.org.

How to Become Mortgageable

For anyone who's dreamed of owning a home, the words "your loan is denied" can be a blow. How easy to give up, especially if you already have some debt and live on a modest income. But patience and hard work can make home ownership a reality.

The best strategy is to meet with an OUCU loan officer and learn about the home loan process before you start looking for a house. That advice comes from Carol Chernikoff, director of mortgage lending at Alternatives Credit Union, Ithaca, N.Y.

"Pre-purchase education is the greatest tool to avoid delinquency and foreclosure," says Chernikoff, who often counsels low- to moderate-income members for as many as three years before they qualify for a first mortgage.

Lenders size up loan applicants on whether or not they are good credit risks. In other words, will an applicant fulfill a debt obligation or fall behind on payments and eventually default? Factors that can derail a mortgage application include a debt-to-income ratio above 35%, less than two years of employment history, nonpayment of bills, and application to purchase property that's depreciating in value.

These "Three Cs" are the traditional acid test for creditworthiness:

• Capacity. Do you have the income to repay the debt? Lenders review employment history, gross monthly income, housing expenses, and outstanding debt.
• Character. How much debt do you already owe, do you pay your bills on time, and are you able to live within your means? Lenders also want proof of stability -- how long you've lived at the same address and held your present job.
• Collateral. Is the property structurally sound or a sagging shack that'll undermine your ability to repay the mortgage? A licensed assessor helps make this determination.
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