Attorney generals of 2 small states (NC and Iowa) warned the federal comptroller months earlier that lenders were pushing increasingly risky mortgages. The newer mortgage loans were termed “predatory lending.” They urges the nation’s top bank regulator to allow states to limit exhorbitant interest rates and fineprint loan fees.

These mortgage loans were termed “oppressive” with the banking industry taking advantage of people struggling to get a loan. States were prohibited from reining in reckless mortgage lenders.

Some states passed laws aimed at limiting quick mortgage loans to slow the subprime lenders frenzy. Interest rate cuts and inadequate supervision of mortgage companies fueled these loans even further, creating a mortgage loan meltdown.

Frank Jackson, mayor of Cleveland, compared subprime mortgage loans to organized crime. No doubt that many lenders will be debating about who is to blame for the mortgage loan meltdown for a very long time.

First-time home buyers looking for mortgage loans for nurses are often shocked when they see the list of closing fees they must pay when buying their home. Some of these fees are paid to the mortgage lender while others are payable to different parties.

Closing costs are a significant part of purchasing a mortgage loan, and you should budget for them ahead of time. Here are the basics on what you will be expected to pay:

The Application Fee
This fee is charged when you first apply for your mortgage loan and is non-refundable. It covers the mortgage lender’s costs of completing your initial paperwork and perhaps even pre approving you for a certain amount.

Loan Origination Fee
This fee is charged by your lenders to cover all of the administrative costs they incur in processing your loan. It is generally charged as a number of ”points”. One point equals one percent of the amount you borrow. So if you are borrowing $200,000, one point is $2,000.

Interest rates are higher on loans that don’t have points. In addition, sometimes it will make sense to pay extra points to have the interest rate lowered.

Title Insurance
This insurance generally costs several hundred dollars. It is necessary to protect both you and the lender in case the person selling you the home does not legally own it. For instance, there could be a lien on the home or another owner that is not present or aware that the home is being sold.

Appraisal Fee
Your lender will require an appraisal of the home before funding your mortgage. They want to be sure that the house is valued at the price you have agreed to pay. Home appraisals general cost a few hundred dollars.

Home Inspection Fee
This is optional, but almost always a good idea. You’ll need to have this done on your own. You’ll want your new home to be inspected by a licensed home inspector. So that you don’t have any new homeowner surprises, you’ll want to know if there are any major problems with the home before signing the paperwork.

Attorney Fees
If you are hiring an attorney’s services there wil be a fee, usually several hundred dollars.

Homeowners Insurance
Most lenders now ask that you prepay the first year’s homeowners insurance at closing.

Private Mortgage Insurance (PMI)
If your down payment is less than twenty percent of the purchase price you will be required to pay private mortgage insurance (PMI). This insurance protects the lender in the event that you default on the loan, but it is an extra expense that you want to avoid if possible. You’ll be required to prepay a portion of this at your closing.

Prepaid Loan Interest
This cost covers the amount of interest that accrues from the time your mortgage is funded until you make your first payment.

Other Fees
You can most likely expect to see various other fees such as messenger fees, recording fees, and notary fees. These are all common fees that come with the cost of a mortgage.

When searching for mortgage loans for nurses, it’s always a good idea to track interest rates.  Mortgage loan rates will have more impact on the monthly payment than any other factor. Of course you want the best interest rate! Even tiny differences in mortgage rates can have a large impact over the life of the mortgage loan.

Every nurse wants to keep their interest rates as low as possible.  The lower the mortgage rate is, the more buying power you have.  Many factors affect what the interest rate will be for your mortgage loan. Some of these factors are more easy to control than others. 

The Federal Government controls mortgage loan rates for nurses in the United States.  The Federal Reserve arm adjusts interest rates positive or negative in an attempt to maintain a strong economy and keep inflation down.  These interest rate adjustments are out of our hands. Rates will go up and down depending on the state of the economy. 

Instead, decide whether you want to choose a fixed-rate mortgage or an adjustable rate mortgage (ARM).  An adjustable rate will have a lower interest rate to start. Many people have gotten themselves in trouble with this, because the mortgage rate is completely dependant on the adjustments that are made in the future. A fixed rate mortgage will have a higher rate at the start, but you are protected against rate increases. 

You sometimes have the choice of paying discount points in order to lower your interest rate.  Each point equals 1 percent of the amount you borrow. If you were borrowing $300,000, one point would cost you $3,000. So it may depen on how much cash you can afford to put into the mortgage when you purchase the loan.

The discounted mortgage rate you receive varies among lenders, but it is usually about a quarter of a percentage point for every discount point you pay.  For example, if you pay 2 points, your rate would be lowered from 6.75 to 6.25 percent. That adds up over the life of the loan.

One financial factor to consider is how long you plan to live in the home before you pay a lot of points to discount your loan.  Be sure to calculate the figures (use a mortgage calculator) both with and without the points to see which is a better deal for you.

You can also choose a shorter term mortgage.  A 15-year will have a lower interest rate than a thirty year mortgage.  The payments will be higher because you are choosing to pay it back over a much shorter term. But it’s a good option if you can manage it.

Don’t forget to review your credit report when shopping for a mortgage. If you have a higher credit score, then you can qualify for a lower interest rate.  Be sure to get a current copy of your credit report and check it for errors.  Correct any mistakes that you find and work on cleaning up any possible problem areas.  Paying your bills on time and avoiding late or missed payments will have a huge impact on yoru credit scores and interest rates. Make it a habit!
Mortgage Loans For Nurses