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Mortgage Questions Answered!

Today’s home buying market is very competitive and being pro-active with your financing has never been more important. Citizen National Bank’s Mary Ann George explains the process of getting pre-approved, the benefits of working with a local community bank and the many options available for you as a buyer.

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Ask The Lender – Bridge Loans

Brent Kohn

Brent Kohn VP Loan Originator NMLS #554361

Spring is upon us and so is the search for that new home.

  • Are you tired of finding the perfect home for you and your family only to see it slip away at the last second because you need to sell your current home first?
  • Perhaps you are just dreaming about upgrading or even downsizing your current home but don’t think it is possible to buy a new home without selling your current home first?

If so, I want to let you know that your dreams can come true here at Citizens National Bank by taking advantage of a bridge loan. A bridge loan is a temporary note taken out against the equity in your current home. You are able to convert your home’s equity into cash to use for the down payment and closing costs of the new home you are trying to purchase.

Typically the bridge loan is written for a short period of time, usually 10-12 months. It is designed to “bridge” the gap between buying your new home and selling your current home. Often times you are required to pay interest only on the bridge loan on a monthly basis. Once your existing home sells, the bridge loan is paid off and any remaining proceeds from the sale are distributed to you. You can even use the bridge loan to pay off your existing first mortgage loan to get rid of that higher monthly obligation. This would allow you to temporarily keep your monthly obligations as low as possible on your current home while taking out a traditional mortgage and principal and interest payments on the new home.

Factors to consider when looking into a bridge loan are:

  • Are you willing to take on the additional monthly obligation on both homes? Even though the payment is just interest only and is relatively small in comparison to a traditional loan, are you willing to make those payments on both homes?
  • Can you qualify to make both payments on both homes with your current income?
  • Do you have enough equity in your current home to take out a bridge loan? Typically lenders want to see that you have at least 20-25% equity left after you take out a bridge loan.
  • Are you willing to pay the costs of an appraisal, title search, recording fee, etc for a temporary bridge loan? How important is it to you to not lose out on the purchase of the new home?
  • How quickly are homes selling in your area? You don’t want to take out a temporary bridge loan and not have your home sell in 10 months. If this happens then you are faced with the additional cost of “renewing” your bridge loan for an additional term.

A bridge loan is a great product to use to help make your dreams come true, but it may not be for everybody. Consult with your Citizens National Bank loan officer to find out if a bridge loan is right for you.

Ask the Lender – Calculate the Costs

There are a lot of factors to consider when determining the costs of purchasing a home. Fortunately, our website, cnbohio.com, has a variety of mortgage calculators available for you to input different scenarios in order to understand what makes the most sense for you. These interactive calculators are easy to use and address many different questions you may have, such as “What’s the Maximum Mortgage I qualify For?”, “Should I Consider a 15 Year vs. a 30 Year Mortgage Term?” and “Should I Buy Points to Get a Smaller Monthly Payment?”. These calculators are a good starting point as you begin to look at your finances and work with your lender.

Here’s a list of all the Mortgage Calculators available on our site. Check them out:

Information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.

-See more at: www.cnbohio.com/AboutUs/CNBNews/CNBConnection/Default.aspx

Enter to Win a Char-Broil Gas2Coal Combo Grill and Grilling Package!

char-broil-gas2coal-grillEnter to win by August 30 by visiting the Home Loans section of our website and clicking the Enter to Win ad on the top right. The Home Loans section provides everything you need to know about applying for a mortgage, CNB’s mortgage options, links to our mortgage calculators and even our current rates. Couldn’t you use a new grill to go with a new home?

To enter, simply complete the online entry form. Indicate any products you might be interested in learning more about and submit. The grand prize package which includes the grill, a $50 Omaha Steak gift card, a 3 piece grilling tool set, serving tray, cookbook, towel, seasoning and 2 can coolies, will be drawn on September 1. Good luck!

– See more at: https://www.cnbohio.com/AboutUs/CNBNews/CNBConnection/

Ask the Lender – Should I Buy a Home or Continue to Rent?

If you’re considering purchasing a home, now might be the time. With the Fed recently raising rates and indicating they plan to again this year, interest rates on home loans will begin to tick up. However, that shouldn’t be your only deciding factor in jumping into home ownership. You’ll need to take into account the cost of home owner insurance and property taxes, as well as Private Mortgage Insurance (PMI) if you won’t have 20% to put towards a down payment. Home ownership also comes with maintenance and you’ll want to consider those costs, as well as the time involved in activities such as mowing a lawn, that may currently be taken care of by your landlord.

The positive side of owning your own home means you’ll have a long term investment and you have something to show for those monthly payments. Also, according to rentalhousingjournal.com, 2015 had the highest rent prices in recent history as demand for rentals continued to grow, so your house payment may indeed be less than what you’re currently paying in rent. On a national average, renters can expect to spend 30 percent of their income on rent, while buyers can expect to spend 15 percent of their monthly income on a mortgage payment. Buying a home is one of the biggest decisions you’ll probably make in your lifetime. Make sure you’re comfortable with your finances and understand the total cost of home ownership by using our Rent vs. Buy mortgage calculators. This calculator helps you weed through the fees, taxes and monthly payments to help you make a decision between the two options. When you’re ready to purchase, contact a Citizens National Bank mortgage lender to help you through the application process and understand the mortgage options available. – See more at: www.cnbohio.com/Personal/Loans/MeetOurLenders/AskTheLender/Default.aspx

If you would like to submit a question for this column, email info@cnbohio.com.

Citizens National Bank’s NEW Home Loans Website Section and Summer Grill Giveaway!

home-loansIn an effort to make it easier for customers to find great information about mortgage and home equity products, Citizens National Bank has officially launched its NEW Home Loans section of the website. The Home Loans section highlights information specific for a first time home buyer, detailed descriptions of loan products offered, a variety of mortgage calculators, and informational articles from mortgage lenders.

Found your dream home? For a first time home buyer, the mortgage loan process can be a thrilling, yet nerve-wracking event. With the new First Time Home Buyers section, you are provided with a description of the available loan options. This section also features the five steps you should take before applying for a home and a variety of informational resources, such as Understanding the Application Process and an Application Checklist.

Also included are mortgage calculators which are useful in determining monthly payments, how much house you can afford and more. These informational and interactive calculators are available as a self-help tool; personalized advice is readily available from any of Citizens National Bank’s qualified professionals.aces-weber-grill

As a thank you for visiting the new Home Loan section, Citizens National Bank is offering monthly drawings for grilling packages from July – September. A grand prize winner will also be drawn in September. Grilling packages include a $50 Omaha Steak gift card, a 3 piece grilling tool set, serving tray, towel, barbecue seasonings, and can coolies. Grand prize is a Weber Grill, courtesy of Lee’s Ace Hardware in Van Wert, with grilling package. Entry is simple – visit the Home Loans section at www.cnbohio.com/home-loans and fill out the Enter to Win form.

– See more at: http://www.cnbohio.com/AboutUs/CNBNews/CNBConnection

From Here to Tennessee, the Bryants Trust CNB!

When Dr. Lance Bryant and his wife Carol originally moved to St. Marys to begin his practice as a surgeon they were impressed with the professionalism and care they received from their mortgage lender, Rod Stover. Now, more than 20 years later, the Bryants not only manage busy medical careers, but have raised 4 children and spend most of their free time at their vacation home in Tennessee. Through the years, they have continued to work with Rod, financing their second home through Citizens National Bank, using CNB for their personal accounts, and now looking to CNB and Rod to help manage their business accounts as well.

Dr. Bryant has his pilot’s license and the couple flies to Tennessee every chance they get for a little R&R from their hectic work. They use CNB Online Banking to manage their accounts from wherever they happen to be and the Bryants appreciate Rod’s willingness to be just a text or phone call away.

View the Bryants’ story at www.cnbohio.com/AboutUs/CNBVideos/.